Brazilian Real Drops amid Political Uncertainty

The Brazilian real dropped against the US dollar today as political uncertainty and turmoil in the country were not helping to make the currency attractive to overseas investors.

Brazilian Congress was pushing for legislation that would prevent an increase of public spending, but President Dilma Rousseff vetoed the move. Congress may yet vote to overrun the veto. Otherwise, further downgrade of the country’s credit grade by rating agencies is not unlikely.

USD/BRL gained from 3.9518 to 3.9808 as of 19:21 GMT today.

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