We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Bitcoin
Bullish
More View more
Real Time News
  • The $USD may rise with USD/IDR, USD/SGD, USD/PHP and USD/MYR as #coronavirus contagion fears hurt emerging markets. The Fed and its repo operations will be closely watched. Get your market update from @ddubrovskyFX here: https://t.co/rPnwmsMlPn https://t.co/s5h6A95Gs0
  • RT @LiveSquawk: Chinese Authorities Confirm Death Toll From Coronavirus Rises To 132, Confirmed Cases At 5,974 - State Media
  • If you missed my LIVE coverage of Australian CPI data where I discussed the $AUDUSD, $AUDJPY and $AUDNZD outlook, check out the recording which is available in @DavidCottleFX's market alert with the full story here #AUD #RBA - https://www.dailyfx.com/forex/market_alert/2020/01/29/Australian-Dollar-Official-4Q-Consumer-Pricer-Index-.html?CHID=9&QPID=917702 https://t.co/91ho4X2EJ2
  • The $NZD may fall against the Japanese Yen after downside breakouts in NZD/JPY and an NZD index. Fundamental catalysts include the coronavirus, China PMI and the Fed. Get your market update from @ddubrovskyFX here: https://t.co/lzo2DAbTXl https://t.co/1N2nzR3jFm
  • 🇦🇺 AUD Consumer Prices Index RBA Weighted Median (QoQ) (4Q), Actual: 0.40% Expected: 0.40% Previous: 0.40% https://www.dailyfx.com/economic-calendar#2020-01-29
  • 🇦🇺 AUD Consumer Prices Index RBA Trimmed Mean (QoQ) (4Q), Actual: 0.40% Expected: 0.40% Previous: 0.40% https://www.dailyfx.com/economic-calendar#2020-01-29
  • #Australian Dollar edges slightly higher following the publication of better-than-expected CPI https://t.co/ErzHfVxpSM
  • 🇦🇺 AUD Consumer Prices Index RBA Weighted Median (YoY) (4Q), Actual: 1.30% Expected: 1.20% Previous: 1.30% https://www.dailyfx.com/economic-calendar#2020-01-29
  • 🇦🇺 AUD Consumer Prices Index RBA Trimmed Mean (YoY) (4Q), Actual: 1.60% Expected: 1.50% Previous: 1.60% https://www.dailyfx.com/economic-calendar#2020-01-29
  • 🇦🇺 AUD Consumer Prices Index RBA Weighted Median (YoY) (4Q), Actual: 1.3% Expected: 1.20% Previous: 1.2% https://www.dailyfx.com/economic-calendar#2020-01-29
Continued Brazil GDP Slump Threatens further Rate Cuts, Real Slide

Continued Brazil GDP Slump Threatens further Rate Cuts, Real Slide

2016-11-30 18:23:00
Oliver Morrison, Analyst
Share:

Talking Points:

Brazil's GDP shrank 0.8% in the third quarter, matching forecasts

• The country’s prolonged recession – now 8 quarters long – could become the worst in its history

• The central bank is widely expected to cut interest rates a further 25 basis points this week

Brazil's economy shrank 0.8% in the third quarter, statistics agency IBGE reported on Wednesday. Growth was down a seasonally adjusted 2.9% compared to the third quarter of 2015.

The data are not as extreme as economists forecasted, but still hammer home the fact that Brazil remains in its worst recession of modern times. The government had hoped a rise in consumer and business confidence after the impeachment of former president Dilma Rousseff would lead Brazil out of its economic funk. But a persistent weakness in spending by both critical groups remains.

Government and economists have cut growth targets for next year to around 1%. Some warn that Brazil will experience another year of recession in 2017, which would mark the worst ever slump in Latin America’s largest economy.

All of this means that the country’s central bank, the Banc Central do Brasil, is widely expected to cut interest rates by a further 25 basis points to 13.75% when it meets later the same day. It had cut rates for the first time in four years to 14% in October in an attempt to boost growth amid signs of slowing inflation.

Another rate cut will put further pressure on Brazil’s currency, the real, which has already been a big loser since Donald Trump won the US Presidential election earlier this month. His unexpected triumph spells trouble for emerging markets such as Brazil, as concerns about Trump’s protectionist policies weigh on emerging-market assets. Trump’s ‘America First’ policies may in turn mean a quicker pace of monetary tightening by the Federal Reserve. Indeed, the markets reckon there’s a 100% chance the Fed will raise US rates at its next meeting on December 14.

USD/BRL made its highest gain since June in the aftermath of the Trump victory, rising to as high as 3.4478. The pair has since dropped a little to trade at 3.3970.

Please add a description for the image.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.