Brazil's central bank to auction $4B after dollar surge

economia.ig.com.br (Portuguese) —

Brazil's central bank announced a new auction of up to US$4 billion in currency swap contracts for Tuesday, October 27, following a sharp surge in the dollar and a steep drop in the stock market. The dollar closed Monday at R$5.409, up 8.41%, its largest daily gain since January 1999, in the first trading session after President Luiz Inácio Lula da Silva's reelection. The central bank had already sold 75,000 contracts worth US$3.75 billion on Monday. The dollar peaked at R$5.584 during Monday's session, while the Ibovespa index fell over 16%, triggering a circuit breaker. Investors are reassessing expectations about public finances and economic policy under the new government.


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