Hard times in Brazil
The market seems to love the idea of opening up while hating the idea of not closing at all.
USD/BRL hit a record today at 5.50. The Brazilian real is now down 26.7% on the year with hardly a bounce off the bottom.
What’s even worse is that the Brazilian bovespa is one among the world’s worst performing equity markets — possibly the worst. In BRL terms it’s down 31% and in USD terms it’s down 49.3%.
The latest leg down in the currency comes on increasing bets of rate cuts and proposed amendments to the constitution to allow the central bank to buy government and corporate bonds.