The 2013 taper tantrum: the imported shock the Brazilian regime absorbed

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The extreme

In mid-2013, the Federal Reserve signaled it would scale back its stimulus, and emerging markets entered stress — the real lost ground along with them. In Brazil, the Radar recorded the clearest signal in September: the premium that commodities in real had built over the stock market dissolved, and risk appetite retreated from assumed territory to neutral. It was a loosening, not a rupture. In numbers, the Commodities (R$)/IBOV ratio fell more than a deviation and a half on the month, and Perene Risk gave way from 62 to 55.

What happened next

The feared emerging-market collapse did not show up in the domestic readings. In December 2013, appetite was still leaning toward risk, only with the stock composition more defensive inside — the utilities widening their lead —, and the intermarket structure firmed again in long territory. In March 2014, domestic appetite reached the absolute top of the series. What truly changed was the price of money: the central bank began raising the Selic — from 9.0% to 10.0% and then 10.75% — defending the real.

What didn't happen

The taper did not turn into a Brazilian crisis. Anyone reading the global stress of 2013 as the antechamber of a domestic collapse would have misread the regime — it held. The real weakened and rates rose, but the market structure absorbed the shock instead of breaking. The shock was external; the regime was not.

Honest verdict

A global alarm the structure digested. Not every imported shock crosses the border of the regime — sometimes it only raises the price of money and moves on.

Continue the story: The alarm that didn't cross the border · When the shock only raises the price of money · The dollar as regime gauge →

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Characters: Flow (risk appetite) · Structure (intermarket) · Dollar · Rates (Selic) · Commodities