Published at 12:43 (GMT) 02 Oct

USDBRL

Well, the worst case scenario for EMG currencies just panned out with US labor data coming much worse than expected. There was some hint that such an event may happen in yesterday trading and the damage is limited. BRL has moved to above 1.805 after opening flat at around 1.79. Domestic industrial production came within expectations and therefore has little bearing on both BRL and Di markets although there is some reversal of yesterday widening in the DI market which is mostly technical. After the market calms down we expect BRL to hold below 1.80 on outlook for inflows.