While Lula Da Silva’s government analyzes alternatives to curb uncertainty, the Central Bank achieved a positive impact on the exchange market.
The Central Bank of Brazil sold this Thursday 3 billion dollars in a spot auction, prolonging a series of interventions in the foreign exchange market amid a exit of greenbacks from the largest economy in Latin America.
After the auction, announced late on Monday on the eve of the Christmas holiday, andThe Brazilian real appreciates 0.5% against the dollar.
The strong devaluation of the Brazilian real
The Brazilian real suffered a significant devaluation of 24% against the dollar, despite the efforts of the Central Bank, which allocated more than US$15 billion this year to try to stabilize the currency. However, the situation remains uncertain.
Although Lula Da Silva’s government implemented measures such as a tax reform and other economic strategies With a view to improving the situation in 2025 and 2026, the results have not been as expected. The tax reform designed to simplify the tax system by replacing various taxes with a single value-added tax generated uncertainty in the market. This is due, in part, to would centralize collection in the federal government and would be managed by an expanded council, raising concerns about its impact on the current tax system.
Lula Da Silva.JPG
REUTERS
As a result, the real continued to fluctuate, reaching a high of 6.30 per dollar. On the other hand, speculation continues to affect both the stock market and the behavior of the currency, and the measures adopted so far have not managed to stop the devaluation. This is already being reflected in the cost of the imported productswith increases of between 14% and 24% in some supermarket items. Furthermore, the inflationary process is beginning to impact more and more on the Brazilian economy.
Source: Ambito
