Dollar Dips to R$ 6.04 as Trump Takes Office and Brazil’s Central Bank Intervenes

The US dollar weakened against the Brazilian real on Monday, closing at R$ 6.0421, a 0.39% decrease. This shift came as Donald Trump assumed the US presidency and Brazil’s Central Bank made its first currency intervention of the year.

The financial news outlet Valor Econômico reported these developments. The dollar’s decline mirrored global trends. The DXY index, which measures the dollar against six major currencies, fell 1.36% to 107.986 points.

This movement reflected investors’ reactions to Trump’s inauguration speech and the Central Bank‘s actions. Brazil’s Central Bank conducted two dollar auctions with repurchase agreements.

This injected R$ 2 billion into the foreign exchange market. The bank used the 10 a.m. Ptax rate of R$ 6.0781 for these operations. This marked the first intervention under Gabriel Galípolo’s leadership.

The timing of these auctions coincided with Trump’s inauguration. Investors had feared potential import tariffs and inflationary policies that could keep US interest rates high.

Dollar Dips to R$ 6.04 as Trump Takes Office and Brazil’s Central Bank Intervenes. (Photo Internet reproduction)

However, Trump’s speech did not focus on the promised import tariffs that had recently caused market stress. Trump merely stated his intention to tax countries to enrich Americans.

He announced plans for an external revenue service to collect tariffs, fees, and revenues. “Huge amounts of money will enter our Treasury from foreign sources,” he declared.

Global Trade Tensions

The new president had previously promised a 10% tariff on global imports, 60% on Chinese products, and a 25% import surcharge on Canadian and Mexican goods. These measures could impact trade flows, increase costs, and provoke retaliation.

Paula Zogbi, Research Manager and Head of Content at Nomad, commented on the situation. “Trump’s talks with China brought relief and expectations that negotiations might ease these measures.

It will be crucial to monitor the new president’s statements on this topic in the coming days,” she said. The dollar‘s performance against the real reflects the complex interplay of domestic and international factors.

As Trump’s presidency unfolds and Brazil’s Central Bank continues its interventions, the currency market remains a key indicator of economic trends and policy impacts.