The market raised its projections and expects the dollar to end the year quoted at 5.99 reais, compared to the 5.70 expected at the beginning of this month, according to a weekly survey released by the Central Bank.
He Brazilian real depreciated this Monday by 0.99% against the dollar and reached a new historical low in its third consecutive day of decline. The North American currency ended the day quoted at 6,094 reais for purchase and the same value for sale at the Brazilian commercial exchange rate.
During the first part of the session, the Brazilian Central Bank intervened in the market to stop the depreciation of the currency for the third time in less than seven days and auctioned 4.6 billion dollars with a repurchase commitment. Despite this action, The real remained in the red throughout the day against the greenback.
The market raised its projections and expects the dollar to end the year quoted at 5.99 reais, compared to the 5.70 expected at the beginning of this month, according to a weekly survey released by the Central Bank.
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REUTERS
Expectation for a new economic report from Brazil
This Tuesday, the monetary organization will release the minutes of its last meeting, in which it will explain the reasons why it decided toincrease the interest rate by 1%, up to 12.25% annually, exceeding market expectations and generating criticism from various industrial sectors.
Investors remain pessimistic and uncertainty regarding the Government’s fiscal adjustment announcement, which is expected to be voted on this week, before Parliament goes into recess until next February.
This spending cutting package provides save $54.8 billion by 2030, but at the same time it contemplates an extension of the income tax exemption for those who earn up to 5,000 reais (825 dollars at today’s exchange rate) per month.
The market reacted pessimistically to this exemption, considering that it could make it difficult to control the public deficit, which is currently 9.5% of the country’s Gross Domestic Product (GDP), and the debt, which is around 80% of GDP.
Source: Ambito
