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USDBRL Expected To Open Lower In Line With Latam Peers

BRAZIL

The central bank intervened with a 530M spot auction on Dec 28. USDBRL soared to 5.31 with thin markets, however over hedging and dividend outflows likely played a part. A slightly less volatile end t the year saw us close around 5.20. USDBRL will be expected to open lower today as international markets extend the risk-on sentiment seen over the past few weeks, pushing stocks and commodities higher.

  • Technically, 5.00 remains the key support and pivot with 5.01 tested in Mid-December and may act as a short-term target in the coming sessions.

President Jair Bolsonaro confirmed that emergency aid will not continue in 2021. The president said that the country went into debt to contain the pandemic and "reached the limit" in relation to emergency aid.


Separately, Brazil's Supreme Court Justice Ricardo Lewandowski has decided to extend the state of public calamity triggered by the Covid-19 outbreak.

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