On a day with a relatively empty agenda in Brazil and abroad, DI rates closed slightly higher on Wednesday, in the opposite direction of the decline in Treasury yields and against a backdrop of portfolio rebalancing moves as it approaches of the end of the quarter.
As of late afternoon, the DI rate for January 2025 was at 9.915%, up from 9.928% in the previous adjustment, while the DI rate for January 2026 was at 9.89%, up from 9.884% in the previous adjustment.
The January 2027 rate was 10.14%, up from 10.125%, while the January 2028 rate was 10.435%, up from 10.413%. The January 2029 contract reads 10.635%, up from 10.607%.
In the absence of positive indicators in the United States and Brazil in the morning, DI (Interbank Deposits) rates sustained slight gains in the first half of the day and, in the early afternoon, began to record slight declines, without there being any specific drivers for Business.
For Lais Costa, an analyst at Empiricus Research, asset prices were driven by portfolio rebalancing moves aimed at the end of the quarter – which basically happens on Thursday, as Friday is a public holiday in Brazil and the United States.
“There is not much macro news that justifies these movements. We have the end of the quarter, and abroad the closing of the curves is largely due to this,” commented Costa, referring to the decline in North American yields this Wednesday.
“Some strong institutional investors need to rebalance their portfolio for regulatory reasons. This is the case of pension funds who need to sell the stock market because the stock market rose a lot in the quarter. So, yesterday (Tuesday) and today ( on Wednesday) we saw more of that (rebalancing) in the stock market, interest rates and exchange rates,” he added.
In Brazil, Fundação Getulio Vargas (FGV) reported in the morning that the general market price index (PGI-M) fell 0.47% in March, slowing deflation slightly after a 0.52% decline in February.
In the afternoon, the Ministry of Labor and Employment released the General Register of the Employed and Unemployed (Caged), showing that Brazil created 306,111 formal job vacancies in February, the best result in two years. The result was well above expectations indicated in a Reuters poll of a net creation of 245,000 jobs.
Both IGP-M and Caged, however, had reduced effects on the Brazilian rate curve shortly after their release. Although the inflation indicator did not exceed expectations, strong job creation in February had already been signaled earlier in the day by Finance Minister Fernando Haddad, with markets still closed.
In the half-hour before the close, however, future rates gained some momentum in Brazil, especially in the long-term segment, where foreign investors are most active.
In this scenario, close to closing, the Brazilian forward curve discounted a 92% probability that the Selic base rate cut in May would be equal to 50 basis points, as reported by the Central Bank.
Overseas, Treasury bond yields continued to fall late in the afternoon.
As of 4:42 p.m., the yield on 10-year Treasury bonds – a global benchmark for investment decisions – fell 4 basis points to 4.194%.
For Thursday, attention turns to a number of indicators that will be published in Brazil: the IBGE unemployment rate in February, the Central Bank’s GDP and balance of payments projections in the Inflation Report and public debt data in February, among others. Also noteworthy is the press conference of the president of the BC, Roberto Campos Neto, on the Inflation Report.
In the United States, data on GDP and unemployment claims, among others, will be released on Thursday.
Source: Terra
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