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Optimism Reversing In USDBRL

BRAZIL

USDBRL has filled the gap from the open to yesterdays close at 5.3083. The increasing likelihood of the government's fiscal cap being tested and the lack of clarity over Brazil's vaccination program is testing the market's optimism amid an international scenario that continues to favour EM.


After early bear flattening in the local curve to reflect the removal of forward guidance from the central bank, the longer end of the swaps rates curve has also shifted higher. Swap rates are up between 4-9 bps across the DI curve.

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