Brazil’s real climbed to a seven-week high as the state-controlled oil producer at the center of a widening corruption investigation was due to publish audited financial results for the first time since August.
The real gained 0.7 percent to 3.0108 per U.S. dollar in Sao Paulo, the strongest on a closing basis since March 5. The rally was the biggest among 16 major currencies tracked by Bloomberg after the pound.
Publication of the delayed results by Petroleo Brasileiro SA before the end of April is credit-positive, Moody’s Investors Service said in a report Tuesday, when trading in Brazil was closed for a holiday. The oil company said in an e-mailed statement a day earlier that it would release third-quarter and 2014 audited earnings Wednesday after markets are closed.
“Investors are eager to know how Petrobras will account for the losses it has had with corruption and how big the damage might be,” Joao Paulo de Gracia Correa, a currency trader at Correparti Corretora de Cambio in Curitiba, Brazil, said in a telephone interview. “We should see a lot of speculation in trading during the day related to that.”
Three-month implied volatility on options for the real, reflecting projected shifts in the exchange rate, was the highest among the 16 major currencies.
The real has rallied 3.7 percent since April 13, when Petrobras said it would present its long-delayed results to the board Wednesday and release the information after its approval.
“It will be important to see the company getting back to its normal state as soon as possible,” Reginaldo Galhardo, a foreign-exchange manager at Treviso Corretora de Cambio, said in a telephone interview from Sao Paulo.
The real rose even as Brazil posted a March current account deficit that was wider than forecast. While the gap in the broadest measure of trade in goods and services narrowed in March to $5.7 billion, it was still bigger than the median estimate of analysts surveyed by Bloomberg. The central bank used new methodology in the balance of payments report.
Swap rates on the contract maturing in January 2017, a gauge of projected changes in borrowing costs, dropped 0.01 percentage point to 13.32 percent Wednesday.
The central bank extended the maturity of currency swap contracts worth $518.7 million. The sale of the swaps, which supported the real and limited import price increases, was halted at the end of March.