Dollar Gets a Three-Year High in Brazil

US dollar Despite interventions by Brazil's Central Bank, the BC, which for three times tried to contain the bullish streak of the American greenback, the US dollar gained 3.46% this Wednesday, December 3, closing the day at 2.475 Brazilian reais against the dollar. Meanwhile, a new report shows foreign investors leaving Brazil heavily in November.

This week alone, the American currency accumulated gains of almost 7%. For the whole year, up to now, the dollar appreciated 39.3% in relation to the real. This Wednesday's exchange rate was the highest since June 2005.

The dollar advance coincided with a report showing foreign investors taking their money out of Brazil. According to Brazil's Central Bank, US$ 7.15 billion were taken out of the country in November, the biggest amount of dollars withdrawn since January 1999, when US$ 8,58 billion left Brazil.

São Paulo's stock exchange, the Bovespa, closed with a slight increase of 0.91% after a day filled with oscillations. During the trading session, the Ibovespa, Bovespa's main index, varied from minus 3.3% to plus 1.15%. Volume was a low 3.42 billion reais (US$ 1.38 billion).

The market's swinging mood reflected in part the international high spirits mainly in Wall Street and European stock markets.

On the down side, the Brazilian market declined after news that Brazil's mining company Vale, former known as Vale do Rio Doce, had laid off 1,300 employees and announced that 5,500 workers would go on collective vacation due to low demand for its goods. Vale's shares still went up 0.22%.

At the end of October, Vale had already informed that it intended to reduce the production of iron ore production and other ores and byproducts in the states of Minas Gerais, Rio de Janeiro and Amapá, besides industrial plants and mines abroad. Plants in China, Indonesia, Norway and France will have their production also curtailed. Vale has 62,000 employees all over the world.

Roger Agnelli, the company's president, explained that the cut of 30 million metric tons, annually, in the iron ore production is a "momentary adjustment" in response to the "very heavy shake-out" the world is undergoing due to the international financial crisis.

The Brazilian steel group Gerdau informed that it will anticipate stoppage of its subsidiaries Açominas and Siderperú (Empresa Siderúrgica del Peru) for maintenance work. As admitted by the company, the measure's intention is to reduce production when worldwide demand for steel, from automakers and building contractors among others, has been reduced.

The president of the group, André Gerdau Johannpeter, acknowledged that Gerdau may take similar steps in other plants especially in the United States and in some Latin America countries. The company is expecting a 24% contraction in the last quarter of 2008 when compared to the same period last year.

Tags:

  • Show Comments (0)

Your email address will not be published. Required fields are marked *

comment *

  • name *

  • email *

  • website *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Ads

You May Also Like

Slow Pace: Brazil Surplus Grows to US$ 10.5 Billion

Brazilian exports totaled last week US$ 3.534 billion while imports amounted to US$ 2.326 ...

Brazil Is on Path to Recovery with Low 4.5% Inflation

Brazil is going through a "non-inflationary economic recovery," says the Brazilian Central Bank. Brazil ...

Animal Feed Factory from Brazil Expands

BioBase Animal Feed has expanded its factory in Àguas Frias, in the interior of ...

Brazilians and Arabs Are All Business

Approximately 380 Brazilian businessmen and 27 entrepreneurs from five Arab countries – Jordan, Iraq, ...

Time for a Strong Brazil-Arab Business Connection

The head of the trade mission from five Arab countries which is in São ...

Boeing 777-300ER with the TAM logo

Brazil’s TAM Becomes First LatAm Carrier to Fly the Boeing 777-300ER

Brazil's largest airline TAM and American aircraft manufacturer Boeing announced today  conclusion of a ...

Twin-engine plane that crashed in Bahia, Brasil

Brazilians Plunder US$ 2.6 Million from Crashed Plane with 4 Dead

A twin-engine plane carrying four people and millions in cash fell Wednesday, March 14, ...

Indian Assassination Has Doubled in Brazil from 20 to 40 a Year

The extreme social exclusion and lack of government actions for truly protecting the rights ...

Brazil and Mercosur Snub the US and Back Venezuela for UN Seat

Mercosur full members expressed on Friday, July 21, support for Venezuela to occupy the ...

Brazil Amazonas’s Drought Worst in a Century

Manaus, capital of the state of Amazonas, and the entire eastern region of the ...