FXStreet (Delhi) – Lee Hardman, Currency Analyst at MUFG, notes that the Brazilian real has been hard hit by the negative spill-over impact from the ongoing slowdown in China.
Key Quotes
“The deepening economic recession in Brazil is placing increasing pressure on their public finances. The real’s sensitivity to the outlook for Brazil’s public finances was again evident on Friday when it declined by over 3% against the US dollar triggered by speculation that Finance Minster Levy would resign.”
“The Finance Ministry’s press office told reporters that Finance Minister Levy never wrote a letter of resignation. It was reported that Finance Minister Levy complained to President Rousseff about his treatment among political allies whose attacks are making job difficult according to a government official with direct knowledge of the discussion.”
“Luiz Inacio Lula Da Silva reportedly who is mentor and predecessor to President Rousseff reportedly wants a new finance minister who would focus more on reviving growth and less on austerity. The removal of Finance Levy would further undermine confidence in the real.”
(Market News Provided by FXstreet)