Real Falls to Decade Low as Brazil Facing Added Budget Concern
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Brazil’s real declined to a 10-year low on concern the nation’s budget deficit will widen and as prospects of higher U.S. interest rates sank demand for emerging-market assets.
The currency dropped 0.8 percent to 3.1264 per dollar at the close of trade in Sao Paulo, the weakest level on a closing basis since June 2004, after climbing 0.6 percent earlier Wednesday. Three-month implied volatility on options for the real, reflecting projected shifts in the exchange rate, was 18 percent, the highest among 16 major currencies tracked by Bloomberg.