Treasury Direct, the government platform on which national treasury bonds are traded, suspended trading three times this Thursday (21) due to strong fluctuations in paper prices. The outages occurred between late morning and mid-afternoon.
Even when the platform is open for trading, only fixed securities can be bought or sold after adjusting to the Selic prime rate, Treasury Selic. When fixed-rate trading and the IPCA Treasury reopened, at 4:41pm, the 2031 fixed-rate bond was paying 12.1%.
The National Treasury is temporarily suspending negotiations to prevent investors from entering into loss-making deals due to prices that do not properly reflect government bond market conditions.
According to market specialists, the sharpest price fluctuations today are caused by signals from the Minister of Economy, Paulo GeddesThe government will not respect the spending cap rule.
When the system was still open, pre-made papers circulated at record rates. At about 3:25 p.m., the yield on the bond maturing in 2031 was 12.16%, up from 11.57% in the previous session, and a record value for this paper, which went on display at Tesouro Direto in February of last year.
volatility The prices of federal government papers have reached the local and foreign markets. When interest rates rise, the prices of these bonds fall.
This is the first time Economy Minister Paulo Guedes has pointed in the same direction, saying he either expects a revision of the spending cap or is asking for a “waiver”, a license to spend on this temporary layer of protection. To complete, Bolsonaro also said he will provide assistance to 750,000 truck drivers to make up for the increase in diesel. As a result, Ibovespa fell by more than 4%.
Joao Beck, Economist and Partner at BRA Investimentos.
If there’s one thing the market doesn’t like, it’s a government that takes populist vagaries and flirts with fiscal irresponsibility, especially when it comes to an emerging country like Brazil.
Rafael Ribeiro, analyst at Clear Corretora