Gold Drops to $1,200/oz for First Time Since June in New York
Brazil's Real Heads for Second Weekly Gain in May on Easing Europe Concern
Brazil’s real headed for its second weekly gain this month on speculation growth in the U.S. will boost the global economy and as China gave a “vote of confidence” for the euro.
The real gained 1.9 percent this week to 1.8196 per dollar at 1:10 p.m. New York time, from 1.8534 on May 21. The currency dropped 0.2 percent today after Spain had its credit rating cut. The real has dropped 4.1 percent this year after surging 33 percent in 2009.
“China this week gave a vote of confidence in the euro and in the U.S. investors are seeing that the economy is moving ahead, despite all this turmoil in Europe,” said Reginaldo Galhardo, foreign exchange manager at Treviso Corretora, a Sao Paulo-based brokerage. “When there is calm in the markets, investors see that there will be a lot of money coming to Brazil in the next few years.”
Brazil’s real jumped the most in more than two weeks yesterday after China’s State Administration of Foreign Exchange, which manages $2.4 trillion of foreign-exchange reserves, the world’s largest, said in a statement that a report that it was reviewing its euro holdings was “groundless.”
Spain lost its AAA credit grade at Fitch Ratings, which said the country’s debt burden is likely to weigh on economic growth.
In the overnight interest-rate futures market, the yield on contracts due in January fell two basis points, or 0.02 percentage point, to 10.97 percent today.