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USDBRL Soars 1.5% On Dollar Strength, Political Backdrop

LATAM FX

LATAM FX: Continued strength in the greenback sees the Bloomberg Dollar Index have a strong bounce off the lows to trade up 0.25%.

  • USDMXN extending gains to 0.65% on the day, firmly back above 20.00, with plenty of room until the nearest notable resistance at 20.2153. One-month peso implied volatility falls to 10.63%, the first drop this week.
  • USDBRL leading the charge making fresh highs from yesterday above 5.0226 and extending towards 5.05 at present (+1.5%). Potential position squaring ahead of tomorrow's US data as well as political developments hampering the bullish local outlook. Local swap rates seen higher across the curve between 5-15 bps, in line with Real losses.

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