Brazil economy sees record coffee exports and savings outflows

Brazil's economy shows mixed signals as coffee exports hit a historic record in August, with volumes rising 31% compared to the previous year. The surge was driven by the arrival of the new harvest at ports, generating US$ 1.3 billion in revenue. Notably, exports to the United States increased by 90%, while Germany and Belgium also saw growth.

In contrast, domestic savings accounts (poupança) experienced a significant downturn. In August, net withdrawals reached R$ 10.5 billion, the largest monthly outflow since 2022. This marks the third consecutive month of net withdrawals. Analysts attribute this trend to the high Selic interest rate, currently at 14% per year, which incentivizes investors to seek higher returns in other fixed-income assets.

Additionally, the Brazilian stock market saw a return of foreign capital in early September, with R$ 3.9 billion in spot market inflows. Meanwhile, the Superior Tribunal de Justiça (STJ) ruled that taxes such as IRPJ and CSLL apply to the remuneration of compulsory deposits held by banks at the Central Bank, following the Selic rate.