Brazilian real: Dollar and long rates retreat; political scene continues on investors’ radar

The prospect that Congress will proceed with administrative reform and the Proposed Constitutional Amendment, which would allow a new, more robust Bolsa Família, but still within the spending ceiling, contributes to a session of risk premium withdrawal in local markets.

RIO DE JANEIRO, BRAZIL - The commercial dollar opened the week falling, as financial agents evaluated the easing of the temperature of the domestic political scene and the prospects that the Central Bank (BC) will have to make more aggressive moves in raising interest rates given inflation expectations for 2022.

Around 10 AM, the commercial dollar was down 0.78%, at R$5.2251 in the spot exchange market. At the minimum, the U.S. currency fell to R$5.2041.

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