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Brazil’s Real Falls Most in Three Years on Record Budget Deficit

Updated on

Brazil’s real declined the most in three years as the budget deficit widened to a surprise record in September, adding to speculation that the Latin American nation’s credit rating will be reduced.

The real weakened 3 percent to 2.4778 per dollar in Sao Paulo in the biggest drop since September 2011 and leaving the currency down 1.3 percent in October. Swap rates, a gauge of expectations for changes in borrowing costs, increased eight basis points, or 0.08 percentage point, to 12.24 percent on the contract due in January 2016. They are up 29 basis points this month.