Dollar Crosses 2.5 Reais Barrier in Brazil. Stocks Go Down

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Brazil's stock market Bovespa The American dollar was up in Brazil for another day, closing above 2,50 reais, this Thursday, December 4. The greenback ended up getting up 2.46% in value, being negotiated at 2.536 per dollar.

The dollar hasn't been this high since April 28, 2005. This brings the accumulated value of the US currency to 42.71% this year. This week alone the dollar gained 9.54%.

As for Brazil's stock exchange, the Bovespa, after a day in the black it ended up the Thursday session down. The Ibovespa, Bovespa's main index, lost 0.48%, ending up the day at 35,127 points.

The volume exchanged stayed below average at 2.5 billion Brazilian reais (US$ 999 million).

Among the best performing shares were Brasil Telecom and building company Gafisa, which saw advances over 8% and 6%, respectively. Blue chips oil multinational Petrobras and bank Bradesco lost over 3%.

Henrique Meirelles, the president of Brazil's Central Bank (BC), informed that the Brazilian monetary authority spent over US$ 6.7 billion from its reserves in direct sales of dollars in the market. The BC, which has more than US$ 200 billion in reserves has already spent a total of US$ 49.5 billion for interventions in the market.
 
The BC revealed on Wednesday, December 3, that due mainly to money withdrawal by foreign investors Brazil had a negative balance of US$ 7.16 billion in November. 

João Medeiros, from the Pioneer brokerage house, believes that the heavy volume of resources leaving Brazil is a reflex of the international economic crisis. Says he, "The companies are very worried. If we have a recession throughout the world we're going to get a smaller commercial surplus."

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