Brasília – The Brazilian Central Bank (BC) decided to expand its intervention in the foreign exchange market this Friday (7th), after six straight days of dollar appreciation. Yesterday (6th), the commercial dollar closed the day at R$ 3.537 with an increase of R$ 0.048 (1.39%). The price reached its highest level since March 5th 2003, when it stood at R$ 3.555. Today, at 2:40 PM, the commercial dollar for sale had a price of R$ 3.518, a decline of 0.55%.
Last night, the BC reported that today’s tender of rollover (renovation) of foreign exchange swaps, operations of dollar sales in the future market, will reach 11,000 contracts. Previously, the BC was putting into the tenders 6,000 contracts, that is, the renovation would cover 60% of the contracts. If it keeps the rhythm, with 11,000 contracts, BC will be able to rollover 100% of the contracts.
The dollar started to go up since the economic team announced, two weeks ago, the reduction to 0.15% of the Gross Domestic Product (GDP) of the primary surplus target. According to economists interviewed by Agência Brasil, the country’s possibility of losing the investment grade of the credit-rating agencies pressured the foreign exchange market.
To try to control the hike, the director of BS’s Monetary Policy, Aldo Mendes, said, in an interview with newspaper Valor Econômico, that “the dollar price is clearly stretched” and that the economic agents are acting “apparently with little rationality”.
*Translated by Sérgio Kakitani with information from the ANBA Newsroom
