This site uses cookies to provide you with a great user experience. By using BondbloX, you accept our use of cookies.
Bond Market News
Brazil’s Dollar Bonds Drop As Currency Sell-off Deepens
December 17, 2024
Brazil’s dollar bonds traded weaker after its currency (BRL) fell to a record low as the central bank’s latest interventions failed to stabilize the currency and stem a selloff. The BRL dropped over 1%, closing at 6.1351 per dollar, despite the central bank selling $1.63bn in the spot market. Investor confidence further eroded after a disappointing spending cut plan, with the BRL being one of the worst-performing EM currencies this year, down 24% YTD. While the Brazilian government is committed to fiscal responsibility, President Lula criticized high interest rates and blamed the central bank for the growing fiscal challenges. Brazil’s central bank has also sold $3bn in a credit-line auction and raised interest rates by 100bp to address its currency volatility. Despite these efforts, experts believe the central bank’s actions may struggle to counter the negative trends in the currency and local rates. The country’s budget deficit is around 10% of GDP, fueling concerns about fiscal instability.
Brazil’s local currency notes dropped by 2-4 points while its dollar bonds traded lower by 1-2 points across the curve.
For more details, click here
Go back to Latest bond Market News
Related Posts:
Brazil Upgraded to BB by S&P
December 20, 2023
BondbloX Pte. Ltd. is regulated by the Monetary Authority of Singapore as a Recognised Market Operator ("RMO") and exempted from Section 49(1) of the Securities and Futures Act (Cap. 289) ("SFA") under Section 49(7) of the SFA.