Forex Blog: Currency Trading News & Analysis.

August 22nd 2006

Brazil attempts to depreciate currency

Brazil’s currency, the Real, is currently hovering around a five-year high against the USD, after an historic run-up in value. In recent months, the Central Bank of Brazil has begun to grow nervous that a more expensive Real could stifle Brazil’s economy by crimping exports. Accordingly, the bank has purchased massive quantities of USD in a bid to hold down the value of the Real. While the Real has certainly stabilized, such intervention is misguided and probably doomed to fail in the long run. Other Latin American countries have followed suit, since western investors began pouring in investment money. Reuters reports:

Brazil’s central bank has been aggressively buying U.S. dollars on the spot foreign exchange market in recent months to build up reserves and, indirectly, prevent the country’s currency, the real, from strengthening too much.

Read More: Brazil’s foreign reserves rise to $70 billion

SocialTwist Tell-a-Friend
Posted by Adam Kritzer | in Central Banks, Emerging Currencies | No Comments »

Sponsored Offers

FREE Daily Email Updates

Enter your email address:

Delivered by FeedBurner

Have Questions? Want to Share Your Review?

Be heard. Please share your reviews today!

Neighboring Posts

© 2004 - 2024 Forex Currency charts © their sources. While we aim to analyze and try to forceast the forex markets, none of what we publish should be taken as personalized investment advice. Forex exchange rates depend on many factors like monetary policy, currency inflation, and geo-political risks that may not be forseen. Forex trading & investing involves a significant risk of loss.