President Donald Trump's threat of imposing 50% tariffs on all goods from Brazil has led to a drop in Brazilian assets, including a 0.8% decline in the real and a 1.5% dip in stock futures.
The tariffs, initially expected to be 10%, have caused heightened volatility in Brazilian markets. Trump's letter cited Brazil's alleged interference in US elections as a reason for the increased levy.
Brazilian President faces challenges in avoiding the tariffs due to legal constraints set by Trump. The situation has put markets on edge, leading to increased risk aversion and potential reassessment of companies with significant exposure to the US market.
Analysts anticipate the tariffs to impact local assets negatively, necessitating reviews of cash flow and valuations for companies heavily reliant on the US market.