The truckers’ strike
As if the shift in the international scenario were not enough, marked by appreciation of the dollar leading to relative depreciation of emerging countries’ currencies, Brazil has now been hit by a trucker strike, with severe repercussions on the economy and politics. The international price of oil has reached US$ 80/barrel, an increase of 20% in little over 2 months. This combined with the weakening of the real has put the price of oil measured in reais at the highest level since the establishment of the currency. Those who only look at inflation do not identify any problem, since the lethargic economic activity reduces the pass-through of this increase to the IPCA. But this fact ignores the inability of truckers/transport companies and service stations to pass on the cost increases to their prices, forcing them to severely squeeze their margins. Normally, at least in countries with rational governments in possession of a modicum of political power, shocks of this order of magnitude are smoothed out by gradual corrections. However, the current government has only one concern – to defend itself against corruption accusations –, using what political force it still has to keep the president in office. The consequences are grave, ranging from sharp deceleration of economic activity to the creation of an extremely unfavorable political climate for the coming elections.
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