Brazil Real Leads Losses as Stock Gain Fizzles on Budget Outlook
- Momentum of currency's rout climbs to highest since March
- Ibovespa erases earlier advance as Petrobras slumps with oil
This article is for subscribers only.
Brazil’s real led world losses and stocks erased gains on speculation that President Dilma Rousseff’s proposal to rein in the budget deficit will fail in Congress after lawmakers began formally discussing the possibility of impeachment on the floor of the lower house.
While the currency briefly pared declines after the Federal Reserve kept interest rates unchanged, the real’s slide was the biggest among 31 major currencies. A gauge of the rout’s momentum, known as the directional movement index, rose to the highest since March. The currency has plunged 32 percent this year on concern the government won’t be able to shore up finances amid the worst recession in 25 years and above-target inflation.