Brazilian Real Losses Ground After GDP Preview

2025-11-17 13:12 By Felipe Alarcon 1 min. read

The Brazilian real weakened past 5.30 per US dollar retreating from May 2024 highs as growing odds of a dovish turn at the central bank coincided with the US dollar paring some of last week’s losses.

Growth signals softened with the IBC-Br down 0.2% in September and preliminary Q3 activity contracting about 0.9% quarter on quarter, a combination that dents export receipts and weakens near term tax revenue prospects.

The central bank left the Selic at 15% and its president stressed a strictly data dependent path for policy which raised uncertainty over when rates will fall.

Meanwhile, markets trimmed the probability of a December Fed cut lifting US rate expectations and tightening the cross border carry trade while the resumption of US economic releases removed the information vacuum that had helped emerging market inflows.

Softer industrial activity in China has also weakened commodity prices and volumes, reducing the trade impulse that normally supports the currency.



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