The dollar closed on Monday falling against the real, just below R$ 5.75, following the practically generalized decline of the North American currency abroad, while in Brazil investors continued to wait for the announcement of the Lula government’s fiscal package. .
The spot dollar closed the day down 0.65%, quoted at R$5.7484. In November, the currency accumulated a drop of 0.57%.
At 5:03 pm, the dollar for December — the most liquid currently in Brazil — fell 0.60%, to R$5.7540.
On the return of the Proclamation of the Republic Day holiday, which kept the Brazilian market closed on Friday (15), the North American currency occasionally fluctuated upwards at the beginning of the day, above R$ 5.80.
But the almost general decline of the dollar abroad began to influence prices in Brazil as well, driving prices into negative territory.
READ MORE: Trump’s eventual victory in the USA increases pressure on the dollar in Brazil
The fact that the dollar has risen in recent weeks opened up space for price corrections in this session, said André Galhardo, economic consultant at the international transfer platform Remessa Online.
“What we saw over the last few weeks was an acute process of appreciation of the dollar, especially after the victory of the Republican candidate (Donald Trump) in the US elections”, he stated in a comment sent to clients.
“It is natural for the market to make this correction movement. The dollar is not only losing value in relation to the Brazilian currency, it is losing value in relation to most developing country currencies and also within the DXY”, he added, referring to the relationship between the dollar and the basket of strong currencies.
The government’s delay in announcing measures in the fiscal area, promised for after the municipal elections, once again supported DI rates (Interbank Deposits), but did not prevent the fall of the dollar against the real.
READ MORE: Is Trump Really That Good for Bitcoin?
In an interview released on Sunday, the Minister of Finance, Fernando Haddad, limited himself to saying that the package has been agreed with President Luiz Inácio Lula da Silva and will be announced “soon”. The ministry’s economic policy secretary, Guilherme Mello, stated this Monday morning that the measures will reinforce the commitment to the fiscal rule.
“This scenario could generate optimism in the market, and, combined with the expectation of higher interest rates in Brazil, could be favorable to the exchange rate, if investors are encouraged by the fiscal package measures”, said Diego Gardi, commercial and analyst at B&T Câmbio, in a comment sent to clients.
In the morning, the Central Bank’s Focus report revealed that the median market projections for the exchange rate at the end of 2024 went from R$5.55 to R$5.60 and at the end of 2025 from R$5.48 for R$5.50.
At the end of the morning, the BC sold all 15,000 traditional currency swap contracts offered at auction to roll over the January 2, 2025 maturity.
