The Ibovespa slipped 0.4% on Wednesday, closing at 179,640 points as investors digested the Federal Reserve’s hawkish pause and shifted their attention to the imminent Selic rate decision. While the Fed kept its benchmark range steady at 3.5%–3.75%, the domestic debate centered on whether the Copom will opt for a 0.25 or 0.50 percentage point cut, against a backdrop of rising regional tensions that pushed the commercial dollar toward R$ 5.20.
The index came under pressure from climbing future interest rates and government threats to sanction companies that violate freight rate rules, which offset a 2.2% advance in Petrobras shares after the company announced new natural gas reserve discoveries. Resource-heavy stocks remained a drag: Vale fell 2.4% amid declining iron ore prices and higher shipping costs, while major banks Bradesco and Banco do Brasil each lost more than 1%.
With global markets contending with the effective closure of the Strait of Hormuz, Brazilian assets are trading under significant uncertainty over how policymakers will balance the need to support growth against the impact of a 0.7% jump in US producer inflation.