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Analysts polled by Commerzbank expect the Brazilian central bank to cut its key rate by 100 basis points, with some forecasting 125 basis points. The bank has cut rates from 14.25% to 12.25% since October 2016, while real rates remain near 7%.
Falling inflation, weak GDP and a stable currency are cited as reasons for the cuts.
Lower interest rates reduce the carry advantage of holding reais, which can weaken the currency and make Brazilian exports cheaper, while also signaling a weaker domestic economy.
econotimes.comFxWirePro TeamApr 12, 2017After 301 past bullish macro events, Brazilian Real (BRL per USD) moved a median +0.4% over 5 sessions (57% higher; middle half -1.2% to +1.7%), and +1.0% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
