The Brazilian real fell today even after unemployment fell, leading to speculations about probable interest rate hike. Concerns about the budget deficit did not allow the currency to profit from the good news.
The Brazilian unemployment rate fell from 5.4 percent in September to 5.2 percent in October. Analysts theorized that falling unemployment and rising inflation will spur the central bank to increase the main interest rate to 10 percent. The real declined despite the supportive data amid worries that the nation’s budget shortage will lead to reduction of credit rating.
USD/BRL jumped from 2.2718 to 2.3084 as of 13:07 GMT today.
If you have any questions, comments or opinions regarding the Brazilian Real,
feel free to post them using the commentary form below.