Exchange Rate in Brazil

Brazil Exchange Rate | Economic News & Forecasts

Brazil - Exchange Rate

Real strengthens markedly in December amid higher risk appetite

The Brazilian real posted strong gains against the U.S. dollar over the past month, largely owing to positive Covid-19 vaccine developments, Joe Biden’s win in the U.S. presidential elections and continued upbeat domestic economic data. On 3 December, the real hit an over four-month high of 5.15 BRL per USD, before trading at BRL 5.16 per USD on 4 December, which marked a 9.9% appreciation over the previous month. Despite this upturn, the real was still down 18.4% year-on-year and 22.0% year-to-date.

The currency was primarily buoyed in recent weeks by higher risk appetite for emerging-market assets amid positive results from several Covid-19 vaccine trials, improving expectations of a gradual return to normalcy for the global economy. Moreover, Joe Biden’s win in the U.S. presidential elections increased hopes of a more stable U.S. foreign policy stance, further lifting market sentiment. Furthermore, positive economic data for the third quarter, with GDP rebounding at a record-breaking pace, provided an additional boost to the currency, as it underscored the continued economic recovery.

Looking ahead, the real is projected to continue appreciating heading into 2021 as economic activity recovers from the Covid-19-induced slump. Uncertainty over fiscal accounts and debt sustainability poses a downside risk, however.

Our panel sees the real ending 2021 at 5.11 per USD and 2022 at 4.89 per USD.

Brazil - Exchange Rate Data

2015   2016   2017   2018   2019  
Exchange Rate (vs USD)3.96  3.25  3.31  3.88  4.02  

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Brazil Exchange Rate Chart

Brazil Exchange Rate
Note: Brazilian real (BRL) per U.S. dollar.
Source: Thomson Reuters.

Brazil Facts

Value Change Date
Bond Yield6.79-0.82 %Dec 31
Exchange Rate4.02-0.13 %Jan 01

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