MRV Engenharia e Participacoes SA (MRVNY:US), the Brazilian homebuilder, slumped to a three-year low in New York trading after the South American country’s central bank raised the target lending rate more than economists forecast.
The company’s American depositary receipts dropped 1.5 percent to $6.50 at 11:34 a.m. in New York. A close at that level would be the lowest since December 2009. Brazilian markets are closed today for a national holiday.
Brazil’s central bank board voted unanimously yesterday to raise the benchmark Selic rate by a half-percentage point to 8 percent. The decision surprised 38 of 57 economists surveyed by Bloomberg, who had expected a second straight increase of a quarter-percentage point. The other 19 correctly forecast the half-point increase.
PDG Realty SA Empreendimentos & Participacoes (PDGRY:US) led a drop among consumer stocks yesterday after the nation’s statistics agency said Brazil’s economy expanded 1.9 percent in the first quarter from a year earlier, lower than the 2.3 percent median growth forecast among analysts surveyed by Bloomberg.
PDG dropped 3 percent to $2.30 in New York today. ADRs for Cia. de Bebidas das Americas, the heaviest-weighed stock on the MSCI Brazil/Consumer Staples index, also tumbled in New York today. AmBev (ABV:US), as the Brazilian unit of Anheuser-Busch InBev NV is known, declined 0.7 percent to $40, set for the lowest close in a month.
The iShares MSCI Brazil Index Fund climbed 0.9 percent to $52.86, snapping five-days of losses, the longest losing streak in two months.
Annual inflation accelerated for nine straight months through March to 6.59 percent, above the top of the central bank’s target range of 2.5 percent to 6.5 percent, before easing to 6.49 percent last month. The central bank said in a statement last night that its decision will help slow inflation and “assure that this trend will persist next year.”
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