The Brazilian real fell today as Brazil’s central bank cut its key Selic rate yesterday. The general mood on the Forex market was not positive for commodities with higher yield, driving the real further down.
The Banco Central do Brasil lowered its main interest rate by 0.5 percentage point to 8.0 percent. The central bank explained in its statement that because of “fragility of the global economy, the contribution of the external sector has been disinflationary”. Indeed, concerns are growing every day that the global economy may face a double-dip recession. It is not surprising that the real suffers in such an environment.
USD/BRL rose from 2.0340 to 2.0466 as of 15:47 GMT today, while the daily high was at 2.0525.
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