Brazil’s central bank chief Roberto Campos Neto said on Tuesday that higher interest rates to combat double-digit inflation are supporting financial inflows, strengthening the Brazilian currency.
Addressing a conference hosted by investment bank BTG Pactual, he also said positive fiscal figures are helping to attract investment to the country, among other reasons that explain the recent exchange rate behavior.
In the year, the real has already risen more than 10% against the dollar, the best global performance for the period, easing pressures on consumer prices after inflation reached 10.4% in the 12 months through January.
“In the exchange front, I think there are several variables. There is a variable that is the higher interest rate itself, which brings flows because of the interest rate differential,” said Campos Neto.
By Marcela Ayres via Reuters