2022: Covid, Climate Change and Oil the Main Challenges Ahead, Dahlia Capital’s Delfim Says

In an interview with Bloomberg Línea, Sara Delfim talks about the challenges in Brazil in 2022

The economist with 20 years' experience in financial markets is one of the 100 Latin American entrepreneurs of 2021 chosen by Bloomberg Línea
December 24, 2021 | 03:10 PM

Bloomberg Línea — “The mantra is diversification”: That was Dahlia Capital’s manager and partner Sara Delfim’s answer when asked about the company’s plans for 2022.

The co-founder of the fund manager said in an interview with Bloomberg Linea that there are three main issues that the company’s analysts will pay more attention to next year: Covid, climate change and oil. In addition, the meetings of the Central Bank’s Monetary Policy Committee (Copom) and the presidential elections in the country complete the scenario for a year that promises some instability.

“Despite the bumpy road, Brazil is one of the leading countries in complete vaccination. Covid is already mapped out for us, now it’s just about complying with the protocols here,” Sara said.

“The second issue is that it’s no good the Central Bank raising the basic interest rate, because that’s not going to make it rain. That’s not going to make the world’s harvests better. We had a drought crisis, there was a major shock in the price of basic foods. Since there was no rain in Brazil, electricity generation is in crisis, and this weighs heavily on the food industry.”


We had a drought crisis, there was a major shock in the price of basic foods. Since there was no rain in Brazil, electricity generation is in crisis, and this weighs heavily on the food industry

Sara Delfim

Read More: Weather Woes May Delay Brazil’s Soybean Harvest to Early January

“The third issue is oil. The price of a barrel touched $85 two months ago, and is now falling again with prospects of new lockdowns around the world. All this generates inflation. But it is not an inflation of demand, with high consumption. It is an inflation of supply. We need more rain and more food,” she said. Other factors on the global stage, such as the change in policy by the Federal Reserve, and the likely acceleration of China’s economy after the winter Olympics will also be on the radar.

The economist with more than 20 years in the financial markets was one of the 36 Brazilian personalities selected among 100 Entrepreneurs of 2021 by Bloomberg Línea. After almost four years at the head of Dahlia, Sara is still one of the few female managers in the country.


She argues that the cycle of interest rate hikes set in motion by Copom this year may not extend too far into 2022, as she believes inflation should start to settle down following the constant hikes from the first quarter of next year.

Raising the Selic rate won’t change these three issues; it ends up squeezing the economy more and making people suffer more, especially the lower and middle classes. A rebalancing of oil prices and increased rainfall in Brazil may lead the Central Bank to hold off on raising interest rates, or even cut them again

Sara Delfim

Read More: Brazil’s Inflation Likely Peaked After Hitting 18-Year High

In Brazil, 2022 is also an election year, with the first round scheduled for October 2. “It’s going to be polarized, combative and noisy as always,” she says. “We’ve been through several, the process is always volatile, and that’s why it’s important to have exposure and protection abroad.”

“It’s also good to have assets of companies with solid balance sheets, strong brands that transcend the Brazilian scenario, that use the down cycle to make new acquisitions. Navigating with caution and well protected, monitoring the rain, oil and China will be determinant,” she says.

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