Brazilian real's volatility undermines foreign trade predictability, says official

Brazilian real's volatility undermines foreign trade predictability, says official

The Brazilian real closed Wednesday at about 5.52 per greenback, its lowest closing price since January 2022, amid high interest rates in the U.S and local fiscal uncertainties.

“We need to wait and see where it stabilizes, the oscillation harms the predictability of business,” Prazeres told journalists at the sidelines of an event in Rio de Janeiro.

She, however, avoided comments on whether the 2024 trade balance could be worse than expected due to a rising U.S. dollar.

© Reuters. FILE PHOTO: A drone view shows the Central Bank headquarters building during sunset in Brasilia, Brazil, June 11, 2024.  REUTERS/Adriano Machado/File Photo

In April, Brazil’s Development, Industry, Trade and Services Ministry reduced its projection for the trade balance in 2024 to a $73.5 billion surplus, from a $94.9 billion surplus it had previously forecasted.

Prazeres, who works at the ministry, also said that a Mercosur’s trade agreement with the European Union is still viable, although there are still issues to be resolved in the talks.

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