The real is suffering from risk aversion sentiment among speculators and Brazilian policy makers are not likely to support the currency. On the contrary, the government may be glad to see a weaker currency as President Dilma Rousseff said that she considers the real “extremely overvalued”. Alfredo Barbutti, an economist at Liquidez DTVM Ltda., summarized:
Everything is favoring the depreciation of the real. The government supports it, and there’s an environment of crisis abroad.
USD/BRL fell from 2.0015 to 1.9967 as of 14:52 GMT today. The daily minimum was 1.9930 and the maximum was 2.0064.
If you have any questions, comments or opinions regarding the Brazilian Real, feel free to post them using the commentary form below.
