BRASILIA (Reuters) -Brazil’s central bank chief, Roberto Campos Neto, indicated on Monday that an improvement in market conditions is paving the way for a shift in monetary policy, while more benign inflation has increased investor bets for earlier interest rate cuts.

Speaking at an event hosted by IDV, a group that brings together major retailers in Latin America’s largest economy, Campos Neto said long-term inflation expectations have started to fall and the yield curve has dropped sharply, demonstrating that “the market is giving credibility to what is being done” by the central bank to reduce price pressures.

Campos Neto added that this situation “opens room for monetary policy action ahead,” without specifying the time frame for such action.

The central bank has consistently expressed concern about increased long-term inflation expectations to justify the need to keep its benchmark interest rate at a cycle high of 13.75%, where it has remained since September despite cooling inflation.

President Luiz Inacio Lula da Silva has criticized this policy stance, saying it hampers economic growth.

Brazil’s central bank is scheduled to make its next monetary policy decision on June 21, which Campos Neto said he could not anticipate.

Campos Neto said on Monday that future interest rates have decreased by around three percentage points since the government presented new fiscal rules, addressing worries about uncontrolled growth in public debt.

He also affirmed that the exchange rate is “moving in the right direction.” The Brazilian real has strengthened 8.4% against the U.S. dollar this year.

“An environment is opening up for us to work with lower interest rates at some point in the future,” he said.

Despite acknowledging that efforts to curb inflation are progressing positively, he warned they should not be prematurely halted, as this could lead to increased costs in achieving disinflation later.

While a weekly central bank survey with private economists shows expectations of rate cuts starting in September, prices on the yield curve point to kick-off in August.

Campos Neto on Monday predicted there would likely be a negative inflation reading in June.

He projected inflation would end this year between 4.5% and 5%, lower than policymakers had initially expected. However, he said core inflation remains high.

The official inflation target for this year is 3.25%.

(Reporting by Marcela Ayres; Editing by Paul Simao and Stephen Coates)

By Noel Randewich and Shristi Achar A

(Reuters) – The S&P 500 and the Nasdaq rallied on Monday to their highest closing levels since April 2022, while Oracle hit a record high ahead of quarterly results as investors awaited inflation data and the Federal Reserve’s interest rate decision this week.

Lifted by gains in market heavyweights Amazon, Apple and Tesla, the S&P 500 has now recovered 21% from its October 2022 lows. Some investors say Wall Street is the midst of a bull market.

“The further out the October lows get in the rear view mirror, the more confident investors become. Have investors become more complacent? They probably have, and that’s actually a good sign,” said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.,

Tesla rose 2.2% and has now climbed for 12 straight trading sessions, a record for the electric car maker.

Apple and Microsoft each rose about 1.5%, with year-to-date gains in the two technology companies’ shares reaching 41% and 38%, respectively.

The S&P 500 climbed 0.93% to end the session at 4,338.93 points.

The Nasdaq gained 1.53% to 13,461.92 points, while Dow Jones Industrial Average rose 0.56% to 34,066.33 points.

Of the 11 S&P 500 sector indexes, eight rose, led by information technology, up 2.07%, followed by a 1.74% gain in consumer discretionary.

The U.S. Labor Department’s consumer price index reading on Tuesday is expected to show inflation cooled slightly in May, with core prices likely remaining sticky. Tuesday is also first day of the Fed’s two-day meeting.

Traders see a 76% chance of the central bank holding rates at the 5%-5.25% range on Wednesday, while pricing in a 71% chance of a rate hike in July, according to the CME Fedwatch tool.

“There’s a chance that the Fed will stay data dependent. So we don’t necessarily think that a rate hike is off the table in the future, but for the near term we just see them staying steady,” said Dylan Kremer, co-chief investment officer of Certuity.

Gains in megacap stocks, better-than-expected quarterly earnings and hopes that the Fed might be nearing the end of its monetary tightening cycle have lifted indexes in recent weeks.

The rally has recently widened to include more economically sensitive sectors such as energy and industrials, as well as small-cap stocks, as data continues to show a resilient U.S. economy despite higher interest rates.

Goldman Sachs on Friday raised its year-end price target for the benchmark S&P 500 to 4,500 from 4,000, citing the broadening of the market rally.

The CBOE volatility index edged up to about 14.8, its highest since last Tuesday.

After the bell, Oracle climbed 3.5% following its quarterly report. In Monday’s trading session it rose as much as 7% to an all-time high after J.P. Morgan hiked its price target.

Nasdaq Inc slumped almost 12% after the exchange operator said it would buy software firm Adenza for $10.5 billion, which analysts called an expensive bet.

Biogen rose 1.5% after a U.S. FDA panel of advisers unanimously backed its Alzheimer’s drug, Leqembi, raising expectations that a traditional approval for the treatment might not come with major new safety warnings.

Broadcom Inc jumped 6.3% after Reuters reportedthe chipmaker was set to gain conditional EU antitrust approval for its $61 billion proposed acquisition of cloud computing firm VMware. That helped lift the Philadelphia semiconductor index 3.3%, bringing its recovery in 2023 to over 44%.

Advancing issues outnumbered falling ones within the S&P 500 by a two-to-one ratio.

The S&P 500 posted 24 new highs and three new lows; the Nasdaq recorded 107 new highs and 68 new lows.

Volume on U.S. exchanges was relatively light, with 10.2 billion shares traded, compared to an average of 10.6 billion shares over the previous 20 sessions.

(Reporting by Shristi Achar A and Sruthi Shankar in Bengaluru and by Noel Randewich in Oakland, Calif.; Editing by Vinay Dwivedi, Sriraj Kalluvila and David Gregorio)

By Abhirup Roy

(Reuters) -Electric vehicle charging companies are cautiously embracing Tesla’s charging technology as the main U.S. standard, mere days after Ford and GM said they were adopting it, but questions remained about how any interoperability would work.

The rare agreements between Tesla Inc and each of the two U.S. automakers, who among them control more than 60% of the country’s EV market, is likely to give top billing to Tesla’s North American Charging Standard (NACS). Tesla shares rose 2.2% on Monday.

That puts companies, including ChargePoint, EVgo Inc and Blink Charging Co, in danger of losing out on customers if they offer only Combined Charging System (CCS), the rival standard that the Biden administration has favored.

The White House said on Friday that EV charging stations that offer Tesla plugs would be eligible for billions of dollars in federal subsidies as long as they included CCS connectivity. The White House aims to spur deployment of hundreds of thousands of chargers, which it sees as integral to EV adoption.

Charger maker ABB E-mobility North America, a unit of Swiss industrial firm ABB Ltd, it will be offering a NACS connector option that it is now designing and testing.

“We are seeing tremendous interest in beginning to integrate the NACS connector into our chargers and our units … customers are saying, ‘when can I get one?'”, said Asaf Nagler, vice president of external affairs at the unit.

“The last thing we want is to rush a solution to the market that is not seamless,” said Nagler, adding, “we still don’t fully know all the limitations of the (Tesla) charger itself.”

Ashley Horvat, a senior executive at Schneider Electric SE’s unit in the U.S. that supplies EV charging hardware and software, said interest in NACS adoption had been on the rise since the announcement by Ford Motor Co and General Motors Co.

Blink Charging said on Monday it would launch a new fast charger with Tesla’s connector, as did ChargePoint Holdings Inc and Tritium DCFC Ltd. EVgo said it will add NACS connectors to its fast-charging network.

Some of these companies’ stocks fell sharply on Friday, but were paring some of those losses on Monday after they said they would adopt NACS.

Still, concerns remain about how smoothly the two standards would talk to each other and whether having both standards in the market raised costs for vendors and customers.

Neither the automakers nor the U.S. government have explained how any interoperability would work or money would change hands.

“We don’t have much visibility on what’s the charging experience going to be like,” said Aatish Patel, co-founder of charger maker XCharge North America.

‘MILES TO GO’

Charger makers and operators noted several concerns about interoperability: whether Tesla Superchargers can adequately charge higher-voltage vehicles with fast charging and whether the design of its charging cables will suit the ports on some cars.

Tesla’s Superchargers are integrated with its cars and payment is tied to accounts of users, who can charge and pay through a Tesla app seamlessly. It offers adapters that can be used to charge its cars at non-Tesla charging stations and is opening up its Superchargers for use by non-Tesla vehicles.

“If you don’t have a Tesla and you use a Supercharger, it’s not as clean-cut. How much integration do Ford, GM and other automakers really want to give Tesla on their vehicles to allow for this seamless integration? Or are they going to pivot into a less seamless integration to have access to a larger network?” Patel said.

A former Tesla official who worked on Superchargers said NACS chargers would add cost and complexity in the near term, but the government needed to support one standard – NACS – given its higher vehicle population and better user experience.

The person, who now works for a charging company, is not authorized to speak to the media and declined to be named. The company that is developing CCS chargers, is “reviewing” its strategy because of the Tesla-GM deal.

“Tesla’s proposal … is not a standard. It has miles and miles and miles to go before it becomes a standard,” said Oleg Logvinov, president of CharIN North America, an industry body that promotes CCS.

Logvinov, who is also chief executive of EV charging parts supplier IoTecha, said CCS was worth backing because it had worked for more than a decade with multiple vendors.

(Reporting by Abhirup Roy in San Francisco; Additional reporting by Hyunjoo Jin in San Francisco and Jarrett Renshaw in Philadelphia; Editing by Sayantani Ghosh and Jonathan Oatis)