Brazilian Real Goes Down as Central Bank Cuts Selic Rate
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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Earlier News About the Brazilian Real:
- Brazilian Real Rallies as There Is Still Some Hope for Europe (2012-06-22)
- Brazilian Real Gains Amid Speculations About QE (2012-06-19)
- Real Declines as Analysts Lower GDP Forecast (2012-06-18)
- Real Rises Even as Central Bank Lowers Main Interest Rate (2012-05-31)
- Brazilian Real Climbs as Central Bank Sells Swaps (2012-05-28)