## Week on the Rise: Ibovespa Up 1.76%, Driven by Mercosur-UE Agreement

The completion of the first full week of 2026 brought positive signals to the Brazilian financial market. The Ibovespa ended the week with a cumulative gain of 1.76%, reflecting the optimistic reception of the trade agreement between Mercosur and the European Union. In the last session, the index rose by 0.27%, closing at 163,370.31 points, benefiting from the progress of negotiations that lasted over two decades.

The treaty is scheduled to be finalized on January 17, with political approval already consolidated between the blocs. Political leaders on both sides celebrated the moment as a milestone for international trade, in contrast to the global protectionist scenario. The German chancellor emphasized that the initiative strengthens Europe's strategic position, while the President of the European Council also publicly expressed support for the advancement.

## Opportunities for Economic Growth and Immediate Beneficiaries

The creation of the world's largest free-trade area offers robust prospects for the Brazilian economy. With a consumer market of approximately 700 million people, the agreement has the potential to increase Brazil's GDP by 0.46% by 2040, according to projections from Ipea. These structural gains will mainly benefit sustainable agribusiness, which will have easier access to European markets.

Products such as meat, coffee, wine, and olive oil will find more favorable export conditions, strengthening Brazil's trade balance. In the stock market, exporting companies immediately capitalized on the news. Minerva (BEEF3) advanced by 2.51%, while MBRF3 recorded a gain of 1.93%. In the pulp and paper sector, Klabin (KLBN11) and Suzano (SUZB3) also closed higher.

## Controlled Inflation and Outlook for the Next Copom Meeting

The positive performance of the week was reinforced by the release of December's IPCA, which surprised with containment. Brazil's official inflation rate for 2025 ended within the target set by the National Monetary Council, contrary to pessimistic forecasts at the beginning of the year. However, services inflation remains resilient, keeping economists attentive.

This inflationary dynamic shapes the decisions of the Central Bank. Projections suggest that the next Copom meeting will maintain the strategy of gradual adjustments of 0.5 percentage points, with the Selic rate potentially reaching 12.5% by September 2026. The Central Bank continues to prioritize monetary rigor to anchor long-term expectations. The futures market reflected this stance, with mixed fluctuations in DIs throughout the week.

In the exchange market, the US Dollar declined by 0.30%, closing at R$ 5.37, favored by positive trade news flow and a calmer external environment.

## International Context and Focus on Volatility

In the United States, December's Payroll report fell short of expectations, although it may reflect distortions from the recent government shutdown. The lower unemployment rate and rising wages suggest relative stability, providing arguments for the Federal Reserve to keep interest rates unchanged in January.

The US Supreme Court postponed its decision on Donald Trump's trade tariffs, delaying the verdict to the following week. Despite this uncertainty, New York indices closed higher, with the S&P 500 hitting new record highs, driven by technology and defense stocks.

## Sector Performance and B3 Scenario

The banking sector showed modest performance, acting marginally in the index's rise. Banco do Brasil (BBAS3) and Bradesco (BBDC4) rose slightly, while Itaú Unibanco (ITUB4) declined slightly. The B3 (B3SA3), the most traded stock, gained 0.56%. The recognition of the liquidation of Banco Master by the US justice system and approval by TCU signaled the end of legal uncertainties affecting the financial system.

Petrobras (PETR4) followed international oil price appreciation, rising 0.33%. Vale (VALE3) declined by 1.14% due to volatility in the Chinese iron ore market, despite accumulating gains of over 3% during the week.

## Upcoming Economic Priorities

The coming week is expected to maintain high volatility. The release of the Monthly Services and Commerce Survey in Brazil is scheduled, along with the IBC-Br indicator previewing GDP. In the United States, the highlight will be the December CPI, which will guide global inflation expectations and influence international monetary policy decisions.