Sweeping U.S. tariffs could prove relatively advantageous for Brazil, Latin America's largest economy, despite President Donald Trump's move to impose a 10% levy on its exports to the United States, economists said on Thursday.
Local markets reacted positively to the highly anticipated announcement on Wednesday, with the Brazilian real strengthening past 5.60 per U.S. dollar and reaching its highest level since October 2024.
Meanwhile, the benchmark stock index edged up 0.23%, with many pointing out that Brazil's comparatively lighter tariff burden could shield it from major trade risks while also attracting capital flows shifting away from the United States.
XP's research team said Trump's tariff policy is "bad in the absolute, potentially net positive for Brazil," as a trade war could bring gains for the commodity powerhouse while also accelerating Chinese investments in infrastructure across the country and Latin America more broadly.
Local markets reacted positively to the highly anticipated announcement on Wednesday, with the Brazilian real strengthening past 5.60 per U.S. dollar and reaching its highest level since October 2024.
Meanwhile, the benchmark stock index edged up 0.23%, with many pointing out that Brazil's comparatively lighter tariff burden could shield it from major trade risks while also attracting capital flows shifting away from the United States.
XP's research team said Trump's tariff policy is "bad in the absolute, potentially net positive for Brazil," as a trade war could bring gains for the commodity powerhouse while also accelerating Chinese investments in infrastructure across the country and Latin America more broadly.
15 hours ago
