Preview of GDP and services data in Brazil, inflation in the US: what to monitor this week

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SAO PAULO – After a shorter week, but quite intense for the market, investors are monitoring next week whether President Jair Bolsonaro will maintain his more moderate tone after the declaration to the nation in a nod to the other powers – and that animated the market in the Thursday (9). Still on the political radar, anti-government protests scheduled for Sunday are also monitored.

Also highlighted is the discussion on the reform agenda and on precatories. According to sources interviewed by Bloomberg, both the government’s political wing and congressional leaders are working towards a narrative in defense of removing these payments from the spending ceiling, while the Ministry of Economy resists the idea.

Sought by the agency, the folder said that it is seeking a permanent solution and sent a Constitutional Amendment Proposal (PEC) to Congress. The ministry also reaffirmed the importance of the spending ceiling to balance public accounts.

On the economic agenda, after inflation measured by the Extended Consumer Price Index (IPCA) in August surpassed expectations, while retail sales in July surprised positively, the Brazilian Institute of Geography and Statistics (IBGE) will release its monthly survey. July services sector on Tuesday (14).

On Wednesday, the Central Bank releases the monthly preview call for the Gross Domestic Product (GDP), also for July, or the IBC-Br. “We hope that economic activity has advanced in the beginning of the third quarter, in line with the expectation of GDP growth, at the margin, in the same period”, point out the economists at Bradesco, who project a 0.4% increase in activity ahead June.

Also pay attention to inflation rates, both here and abroad. On the 16th, the IGP-10 for September will be released, with the Bloomberg consensus estimate for a slowdown to 0.4%, compared to 1.18% in the previous month. Quadrisweeks of the IPC-S and IPC-Fipe will also be released, on Thursday and Friday, respectively.

Abroad, inflation in the US is highlighted amid expectations about when the Federal Reserve will start withdrawing stimulus, with the reduction of its bond program.

The August CPI, or consumer inflation, will be released on the 14th. The retail sales, industrial production and Empire Manufacturing index for the week are still on the radar.

In the euro zone, the consumer price index for August will also be released on Friday morning (17).

In China, August retail and industry figures come out next Tuesday night, which may trump the impact of Covid’s delta variant, amid fears over the Asian giant’s economic slowdown.

Corporate radar and options expiration

On the national corporate radar, shareholders of Cia. Hering (HGTX3) and Grupo Soma (SOMA3) will deliberate on business combinations next Tuesday at the Extraordinary General Meeting (AGE). Hering shares will no longer be traded on the 20th, with the company’s shareholders starting to hold SOMA3 shares (see more by clicking here).

B3 will also have options on Ibovespa on Wednesday (15) and stock options on Friday, which could add volatility to the index.

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