The rise in the dollar increases the cost of living in Brazil. Many products sold in Brazil have their prices linked to the US dollar quotation. Drugs and fuel prices are deeply affected by the dollar's price in Brazil.
Foreign capital flows are very important for Brazil. However, the slow pace of Pension Reform in the National Congress drives international investors to become more pessimistic about making new investments in Brazil.
Since May 16, the price of the US dollar in Brazil has exceeded R$ 4.00 and remained above this level. Today, the dollar is up in the Brazilian financial market.
Many analysts are saying that it will only return to a lower level if there is an improvement in the climate abroad, with a possible understanding between China and the United States, or if there is greater confidence in the approval of the Pension Reform in Brazil.
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