Brazil (8th largest economy) is the dominant force in Latin America, with its Bovespa index and BRL setting the tone for regional markets. Key indicators: (1) SELIC rate (Brazil's benchmark) — often among the highest in major economies (historically 10-14%). High SELIC attracts carry trade inflows, strengthening BRL and supporting Bovespa. Rate cuts signal growth prioritization. (2) IPCA inflation (Brazil's official CPI) — BCB targets 3.5% ±1.5%. Persistent above-target readings delay rate cuts. (3) Commodity prices are Brazil's lifeblood — iron ore (Vale is ~15% of Bovespa), soybeans, coffee, oil (Petrobras ~10% of Bovespa). China's demand for iron ore directly impacts Brazil's trade balance and BRL. (4) Fiscal deficit/GDP ratio — Brazil's persistent fiscal concerns create risk premium in BRL assets. (5) Trade balance — Brazil typically runs surpluses driven by agricultural and mining exports. Record surpluses strengthen BRL and ease fiscal concerns. (6) Political risk premium — Brazilian markets price in governance risk; policy uncertainty can cause 3-5% Bovespa swings independent of global factors.