Internally, the bank points to the deter loan credit insurance iorating economic and political outlook as factors that increase exchange rate volatility. JP Morgan argues that the current fundamentals led to increased fair price estimate for the dollar from R $ 3.48 to R $ 3.56 in the medium term.
"The fiscal dimension is becoming more relevant to explain the fundamentals of a weaker real," according to analysts at JP Morgan who sign a report released on Friday (4).
The continued strong appreciation of the dollar has a good side. According to JP Morgan, the most expensive dollar should help reinforce the current trend of adjustment in the external accounts, stimulating exports of goods and services, to some extent, and also raising the cost of imports.
"We believe that the government will allow the devaluation of the real, since it seems a necessary adjustment to increase competitiveness, and should only intervene to prevent exce loan credit insurance ssive volatility," analysts say.
Inflation
The most expensive dollar increases the pressure on prices, although they are partially offset by the impact of the economic recession. The estimate for market prices increased from 5% to 5.6%. Thus, the JP Morgan also revised its estimate for inflation in 2016 from 5.4% to 5.5%.
Written by Sergio
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