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BRAZIL: USDBRL Holds Close to 5.50, Weekly Close Above Resistance In Focus

BRAZIL
  • Brazil's lower-than-expected unemployment rate and the positive sentiment for equities moderately bolstered the BRL at the open, although these gains were quickly pared as markets await the US PCE data.
  • After piercing above medium-term resistance on Thursday, USDBRL holds tight to 5.50 and the weekly close will be monitored closely for signs of whether the USDBRL rally could further build momentum. 
  • BCB Governor, Roberto Campos Neto said Thursday that raising interest rates again is not part of the Copom's main scenario, and the intention of the official communication was not to provide any guidance. Interestingly when asked by MNI, he denied telling Tarcísio de Freitas, currently São Paulo governor and a possible candidate backed by former president Jair Bolsonaro for the presidency, that he would be his Finance Minister if he decided to run in the 2026 election. The Brazilian newspaper Folha de São Paulo reported the information two weeks ago.

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