# Brazilian real drops as fiscal worries overshadow central bank optimism | Financial Post

> Brazil's real reversed early gains to trade about 1% lower after the central bank kept the Selic rate at a record 2.00% and dropped its forward guidance on low rates. Investors focused on fiscal policy concerns and the need for stimulus against a record budget deficit.

- Date: 2021-01-21 · published 2021-01-21T12:00:00.000Z
- Category: macro · region Brazil · magnitude low
- Page: https://feedsoft.ai/events/49385-brazilian-real-drops-as-fiscal-worries-overshadow-central-bank-optimism
- Commodities: [Brazilian Real (BRL per USD)](https://feedsoft.ai/c/USDBRL.md)

## Why it matters

Fiscal doubts and a hawkish shift in guidance weaken the real, which makes Brazilian dollar-priced exports such as soymeal cheaper for foreign buyers. This can pressure South American feed ingredient prices.

## Read by commodity

- USDBRL: bullish ▲

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| USDBRL | 2023-01-20 | [Brazil's real set for 2% weekly loss on worries over c.bank independence \| Financial Post](https://feedsoft.ai/events/37979-brazil-s-real-set-for-2-weekly-loss-on-worries-over-c-bank-independence.md) | -2.6% | +0.2% |
| USDBRL | 2020-03-18 | [Brazil central bank wades into FX, bond markets but real slump accelerates \| Financial Post](https://feedsoft.ai/events/54309-brazil-central-bank-wades-into-fx-bond-markets-but-real-slump-accelerates.md) | +1.1% | +3.8% |
| USDBRL | 2024-08-30 | [Brazil Real Swings on Fiscal Woes, Central Bank Interventions](https://feedsoft.ai/events/29017-brazil-real-swings-on-fiscal-woes-central-bank-interventions.md) | -0.8% | -3.6% |
| USDBRL | 2023-05-31 | [Brazil's real leads fall in Latam FX, Chile's peso down as copper output drops \| Financial Post](https://feedsoft.ai/events/36145-brazil-s-real-leads-fall-in-latam-fx-chile-s-peso-down-as-copper-output-drops.md) | -3.0% | -4.3% |
| USDBRL | 2022-12-07 | [Brazilian real up on fiscal relief; Peru's sol falls amid political turmoil \| Financial Post](https://feedsoft.ai/events/38510-brazilian-real-up-on-fiscal-relief-peru-s-sol-falls-amid-political-turmoil.md) | +0.5% | +2.7% |

## Sources

- financialpost.com: https://financialpost.com/pmn/business-pmn/brazilian-real-drops-as-fiscal-worries-overshadow-central-bank-optimism

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Data from Feedsoft AI (https://feedsoft.ai/). For information only; not investment advice.