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Brazilian President Bolsonaro........>

BRAZILIAN REAL
BRAZILIAN REAL: Brazilian President Bolsonaro reiterates his stance that he
hopes the BRL gains against the greenback, adding that he also hopes the BCB's
benchmark interest rate falls (The Brazilian central bank hold one more decision
this year, on December 11th). Bolsonaro's comments somewhat contrast with those
seen from the country's economy minister Guedes, who seemed to trigger the BRL
weakness Monday after stating that BRL's value is of no concern to the country
(echoing the official stance of the central bank). Some also eyed the proposed
20% tax on Brazilian dividends as being behind the weakness.
-Reports note that on the recent downtick in BRL there has been little - if any
- sign of intervention in USD/BRL outside of the usual auction activity to
manipulate the FRA curve. USD/BRL finished the Monday session at multi-year
highs of 4.2276. All time highs printed back in 2015 sit at 4.2483.
-Implied vols are moving in tandem with BRL at present, with the 3m measure
today hitting multi-month lows and could soon revisit the lows seen in July at
10.72 points.

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