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Political Woes Exacerbate Risk-Off Move For BRL

BRAZIL
  • Emerging market currencies slumped to a two-month low on Tuesday, with BRL posting its worst session in four months, hampered by political woes, sliding commodity prices and a buoyant greenback. The Real extended losses into a sixth straight session, sinking 2% to a notable resistance area for USDBRL around 5.20.
    • The Ibovespa fell for the second day, dropping 1.4 percent, or 1,825.1 to 125,094.90 in Sao Paulo. The move was the biggest since falling 1.7 percent on June 25. Petrobras contributed the most to the index decline, decreasing 4.1 percent.
  • Today markets will see the release of May retail sales before the domestic focus shifts to tomorrow's IPCA inflation readings.
    • 1300BST/0800ET: May Retail Sales M/M, est. 2.3%, prior 1.8%
    • 1300BST/0800ET: May Retail Sales Y/Y, est. 17.5%, prior 23.8%

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