USD/BRL: Real supported for now, renewed weakness expected in the longer term – Commerzbank

FXStreet Insights Team FXStreet

For the time being, USD/BRL should trade around current levels. Longer term, however, economists at Commerzbank see BRL depreciation risks returning.

Attractive real interest rate supports the Real

“The USD/BRL exchange rate has already reached our target of 4.95 and should remain around this level for the time being, supported by the attractive real interest rate.”

“In the longer term, we are concerned that the government could increase its influence on monetary policy which could lead to a renewed weakening of the Real.”

Source: Commerzbank Research

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