Since the beginning of the year, the real has lost 30% in value against the dollar—an aversion to the Brazilian currency not seen in almost 20 years. Foreign banks are now classifying the national currency as a "toxic asset."
The loss of currency value, which started last year because of the drop in the interest differential between Brazil and other countries, has accelerated in recent months. This is due to issues related to the coronavirus, the worsening of the political environment, and the possibility that the country may be left behind in the post-pandemic global recovery.
The real currency has depreciated the most this year among emerging countries, with a loss of 29% against the dollar.
The difference is noteworthy for countries in Latin America, whose second-worst result is the Mexican peso (-19%), and economies such as South Africa (-22% of the rand) and Russia (-13% of the ruble) .
The Brazil risk measured by the CDS (Credit Default Swap) rose 220% in 2020. On average, in emerging countries, the increase was 77%.
Last week, the real appreciated again (closed on Friday, 22, sold at R $ 5.58), but it did not gain over other emerging currencies.
Translated by Kiratiana Freelon