Brazil: For The Long Run
(World News Brazil)

The iShares MSCI Brazil ETF (EWZ) had a poor first half of 2018. The ETF fell over 33% from its January peak and erased all gains made in 2017. The rising strength of the dollar caused a large depreciation in the Real. On top of that, presidential election season is just beginning and it`s unclear what Brazilians wish for their economic future. Here is a chart of EWZ and the Brazilian Real (BZF) since 2017: Source: Thinkorswim As you can see, the main force behind the Brazilian ETF is the Real. When the Real is weak, the value of Brazilian stocks deteriorates greatly. To understand this fully we must look at inflation. Following the commodity price crash in 2015, the Brazilian inflation rate...