Bloomberg News

Brazil May Buy Dollars, Consider New Currency Policies, UBS Says

January 31, 2012

Jan. 31 (Bloomberg) -- Brazil’s central bank is likely to resume its dollar purchases and the Finance Ministry may introduce new foreign exchange policies after the real strengthened to less than 1.75 reais per dollar, UBS AG analysts Andre Carvalho and Eamon Aghdasi wrote in a report dated yesterday.

Such measures may cause the real to depreciate for a short period, before rising to 1.60 reais per dollar by the end of 2013, they said.

Brazilian policymakers’ high sensitivity to appreciation of the currency, low worries about inflation and increasing focus on economic growth suggest the announcement of such measures may be “fairly imminent”, according to the analysts.

To contact the reporter on this story: Karen Eeuwens in London at keeuwens@bloomberg.net

To contact the editor responsible for this story: Helder Marinho at hmarinho@bloomberg.net


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