Brazilian Real Benefits from European Optimism

The Brazilian real was one of the emerging market currencies that profited from an increase in risk appetite after speculations suggesting that the EU will help Greece to solve its budget deficit crisis raised demand for commodities and assets in the South American country, and among other emerging markets.

The real had its sharpest advance in 5 days before an European Union summit in which traders expect the bloc to propose a rescue plan for Greece if it manages to introduce measures to shorten the gap in its public accounts, bringing optimism back that the economic sentiment will recover in 2010.

USD/BRL closed at 1.8460 from an opening rate of 1.8694 this Tuesday.

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