Brazil's real weakened for the first day in six as some investors took advantage of a rally in the currency to buy U.S. dollars.
Brazil's currency gained 3 percent last week, making it attractive for investors to buy dollars, which were in short supply because of the U.S. Labor Day holiday, said traders such as Hideaki Iha at Souza Barros Corretora. The currency closed Friday at its strongest level since reaching 2.2782 per U.S. dollar on Aug. 10.
``The market today was small and there wasn't a big flow of dollars,'' said Iha, chief currency trader at the Sao Paulo brokerage, in a phone interview.
The real fell 0.3 percent to 2.3372 reais per U.S. dollar at 3:18 p.m. New York time, after rising as much as 0.7 percent earlier.
Brazil's currency may strengthen in the coming days on expectation companies such as Gerdau SA, Latin America's biggest steelmaker, the Brazilian unit of Banco Santander Hispano SA will sell bonds abroad and bring the dollars into the country, Iha said.
Gerdau said last week it plans to sell $250 million of bonds with no fixed maturity, primarily in Europe and Asia and Banco do Estado de Sao Paulo SA, the Brazilian unit of Spain's biggest bank Santander, plans to sell $300 million of perpetual bonds, which don't have a set maturity, a person familiar with the sale said.
``We are still seeing bond sales abroad,'' Iha said. ``The currency has everything it needs to strengthen.'' |
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