Brazilian Real Gains as Central Bank Suggests No Interest Rate Cuts

The Brazilian real gained against the US dollar today as the nation’s central bank signaled that it is not considering monetary easing as inflation is expected to remain above the bank’s target.
The Central Bank of Brazil raised its inflation forecast for 2016 from 6.6% to 6.9%, whereas the bank’s target rate is at 4.5%. The bank said in the Inflation Report that uncertainties surrounding domestic inflation and the global economy “do not allow to consider the hypothesis of monetary easing.” This, as well as the improving market sentiment, allowed the real to jump more than 1% against the dollar during the current trading session.
USD/BRL dropped as much as 1.27% to 3.3498 as of 13:47 GMT today.

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