After the euphoria of the beginning of the year, investors’ expectations decreased to the level of the main Ibovespa index at the end of the year.

Only 47% of investors polled by a Bank of America Merrill Lynch survey see B3 above 110,000 points in December. In July, amid the success of the Social Security reform in the House of Representatives, this percentage was much higher, at 87%.

What do investors expect for dollar behavior? Currently 40% of investment fund managers believe the dollar will be above $ 4 by the end of the year, a much larger share than in September, when just over 20% of respondents had this expectation.

Why this reduction in expectations? The tensions brought about by the trade war between China and the United States seem to be one of the main factors: for 53% of respondents, the tension between the two countries is the main risk factor for Latin American markets over the last four months.

In addition, aversion to risky countries like Brazil is increasing: only 13% of respondents said they are taking risks above levels considered normal, compared to 24% in September.

What is the investor’s vision for the long term? In the long run, expectations remain positive, with 9 out of 10 retired investors that Brazil will regain its investment grade.