Evidences from Brazil. This paper investigates the relation between political news and market returns. Then we looked for periods of abnormal volatility which might be associated with political events using a parametric and a nonparametric method. Notwithstanding there were news like important politician been arrested and even speculation about the beginning of an impeachment process, we found relation between abnormal volatilities and political news only in Ibovespa returns during Presidential Elections.
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Escorted by the British, the Portuguese court fled to Brazil, resulting in the Kingdom of Portugal being based in Rio de Janeiro from until After the Second World War, it was decided that gradually preparing the country for a central bank was better than the immediate introduction of a central bank. With the establishment of the official central bank, currency-related duties were transferred away from the Banco do Brasil; its importance as the agent for financing government policy also declined.
The Banco do Brasil was restructured as a purely commercial bank in Brazil has one of the most unique currency and monetary policy histories of any country. Given its struggles with hyperinflation, its banking authorities have introduced several new currencies in their attempts to ward off stubbornly steady price increases over the decades. The Banco do Brasil played a large role in the Real Plan that was implemented in to successfully tackle inflation in Brazil and continues to be one of the largest banks in Latin America.
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Do Political News Affect Financial Market Returns? Evidences from Brazil