USD/BRL: BCB cut will not affect the Brazilian real – TDS
|Economists at TD Securities see very little arguments to keep the BCB from easing another 50bps at the May meeting. USD/BRL is trading at 5.5803.
Key quotes
“We expect the BCB to cut rates by 50bps at the May meeting, citing further demand deterioration due to the Covid-19 crisis.”
“We continue to see BRL following a depreciation path, with little impact from the interest rate decision for now.”
“The BCB has decided to focus on growth support, and with the size of the economic shock in play, there is little cost from the potential pass-through risk to inflation from BRL depreciation for now.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.