Forex Blog: Currency Trading News & Analysis.

September 12th 2007

Brazilian Real rises on rate differential

The Brazilian Real is one of a string of currencies which is rising against the USD on the heels of speculation that the Federal Reserve Bank will cut US interest rates at its next meeting. If the meeting conforms with market expectations, the Fed will cut the benchmark federal funds rate by 50 basis points, to 4.75%. Such a move would further widen the gap between American and Brazilian interest rates, which are currently among the highest in the world.  The Brazilian Real has already climbed 10.5% against the USD during 2007, a run which should continue if the Brazilian economy further outperforms the US. Bloomberg News reports:

“Markets pressing the Fed for a rate cut will remain the story in global currency markets for a few more days,” said a local trader of Brazil’s foreign debt. “A rate cut would allow investors in Brazil to focus on the fundamentals, which point toward a stronger currency.”

Read More: Brazil’s Real Advances on Bets U.S. Will Cut Rates Next Week  

SocialTwist Tell-a-Friend

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.