Falling Dollar

The Dollar could suffer even more significant drops in the coming weeks after President Putin regulated that all Russian exports must be paid in the national currency, the Ruble.

European countries dependent on Russian natural gas and oil will have to pay in this currency at the February 24 exchange rates if they want to maintain a regular supply of these basic products to their power plant. France and Germany in addition to Italy are super dependent on these resources and will have to adapt to this rule.

In another scenario, the Dollar and the Euro are suffering devaluations around the world, given the weaknesses, observed by many, in reference to the energy dependence of these countries on Russia.

The FED (American Central Bank) is sequentially raising interest rates to hold the Dollar and keep inflation under control, already close to the double digits.

The boomerang effect that may occur with the Russian foreign exchange regulations could increase the value of the Real against the Dollar and the Euro as several countries in the Asian area are already considering doing their business with Russia in Rubles and thus fleeing the Dollar.

With the new foreign exchange market rules for import and export, there should be a demand for rubles and European countries should create some kind of reserve of this currency. In Brazil, many businesses are already carried out with exchanges of national currencies, mainly within the businesses that pass through the BRICS and in this way they can be kept as they are and fleeing the American currency. Many countries are putting off their business, giving themselves time to assess which opportunities best suit them. Right now, what we have is a break for investors to seek safe havens for their investments. Brazil has certainly been offering excellent opportunities, especially in sanitation and tourism infrastructure. Europe is going through a very critical moment, which had already been observed for approximately six months with the effects of the management of the Pandemic in several countries and in their internal economies. They are practically "living on appearances", but the difficulties are quite significant, especially in relation to their agricultural production, hampered by the absence of labor in the field for a prolonged period, with production drops between 35%-40% in France and Germany. In the westernmost part of Europe, there were severe and large droughts in the agricultural sector. Who would actually be Europe's potential supplier is precisely Ukraine, which had been maintaining its production levels, which is currently undergoing this war. It is necessary to observe the displacement of giant markets such as Canada, which increased its purchases of meat, China, which has its stocks guaranteed for a good period of time, and as a growing demand for food, which we have already been experiencing, Brazil tends to be the breadbasket to the world and has the potential to do so, provided that our politicians continue in a positive way. I would recommend that production volumes could go through a longer period of storage to guarantee good prices when selling in addition to domestic demand.