USD/BRL rallied sharply Wednesday,...>

BRAZILIAN REAL: USD/BRL rallied sharply Wednesday, rising to just shy of the

4.00 handle in easily the worst session of the month for the BRL. Bulls now eye

the March highs at 4.0158 as the first target, which marked the highest USD/BRL

rate since early October last year. The weakness comes despite the Lower house

committee backing pensions reform after the committee secured concessions from

the government. The bill itself now proceeds to Congress, leaving a still-long

process before being written into law.

-JPMorgan today wrote that the upside potential for the BRL on any relief from

the benchmark pensions reform is likely limited by a restricted growth outlook

for the country. As a result, JPM forecast USD/BRL at 3.90 at the end of 2019

(above consensus).

-April inflation data is next up, expected at 0.67% M/M and 4.65% Y/Y.