BRL Monthly Outlook: October 2021
Updated: Oct 5, 2021
This month's key takeaways for the Brazilian Real:
• The elevated Selic is trying to offset the out-of-control inflation, however, this hawkish stance is a double-edged sword.
• Brazil’s Central Bank intervening to ensure the smooth functioning of the market, is an attempt to curb the volatility mid-term.
• Fiscal uncertainties and political noise add downside risks to growth through next year.
• Implied Volatility for 1 month is around 16%.
• Plans to expand social programs ahead of next year’s elections will continue to weigh on the BRL.
• USDBRL forward points skyrocketing.
• DXY is moving up to its highest level in a year, after the FED turned in another hawkish display.
To read our full report, download the file by clicking the button below: