Brazil’s Real Weakens as Brexit Risk Outweighs Economic Outlook
- Currency declines for third consecutive day amid global rout
- Emerging-market currencies fall as traders seek safe haven
Measuring the Global Market Risks of a Brexit
Brazil’s real weakened for the third consecutive day as growing concerns over the prospect of the U.K. exiting the European Union rattled global markets, overshadowing forecasts for faster Brazilian economic growth.
Investors sought safe-haven assets including yen and gold as anxiety over the prospect of the U.K. leaving the European Union sparked a selloff in riskier markets. The global pessimism weighed on the real, which reached the highest level in 11 months on June 8 amid speculation that new central bank president Ilan Goldfajn will refrain from intervening in the market. Goldfajn said at his swearing-in ceremony Monday that the central bank can reduce its currency exposure when conditions allow, without giving further details. He also nominated four new central bank directors.