Brazil Swaps Rise on Rate Signal; Real Falls as Ibovespa Gains
- BCB says stubborn inflation leaves no room for monetary easing
- Currency drops after auction of $500 million in reverse swaps
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Brazil’s swap rates rose the most since March on speculation the central bank will refrain from cutting borrowing costs from an almost decade high. The real fell and the Ibovespa advanced.
Swap rates, a gauge of expectations for interest rates, increased after policy makers said stubborn inflation leaves no room for monetary easing. The Ibovespa gained as a rally in miner Vale SA outweighed bank declines. The real fell after the central bank sold all 10,000 reverse currency swaps offered on Thursday, a move equivalent to buying $500 million in the futures market. Brazilian dollar bonds slumped as the nation planned to sell global debt for the first time since March.