Brazilian currency fell 21.8% against the dollar, to R$6.19 at the BC rate; it was the 6th biggest devaluation in the world
The real was the currency that depreciated the most compared to the dollar among countries in the (group of the 20 largest economies in the world). It was also the 6th that lost the most value among 118 world currencies, according to a survey by Alex Agostini’s chief economist. Here is the report (PDF – 69 kB).
The study was carried out based on ptax, which is Brazil’s official currency calculated by the (Central Bank). The dollar exchange rate closed R$ 6,19. As a result, the real devalued by 21.8% in 2024. It was no worse than the currencies of South Sudan (-72.0%), Ethiopia (-56.5%), Nigeria (-41 .7%), Egypt (-39.2%) and Venezuela (-30.8%) – poor countries with economic problems.
The Argentine peso depreciated 21.6% against the dollar. It was 7th in the ranking. The euro fell 6.1%. England’s pound fell 1.6%.
DOLLAR QUOTE
The dollar exchange rate is a result of supply and demand. When there are more US currency resources in circulation, the lower the value will be. The same goes for the opposite scenario. The less dollars there are in circulation, the higher the exchange rate, since there is a shortage of the currency.
In Brazil, it is up to the Central Bank to regulate the market. The country has a floating exchange rate regime. There is no exchange rate target and, therefore, the monetary authority does not act in the event of a possible devaluation of the real in relation to the dollar motivated by economic fundamentals.
The BC is responsible for selling dollars at auctions when available. The president of the monetary authority, Roberto Campos Neto, on December 19 of this year that the institution needed to act in December due to the outflow of dollars.
COMERCIAL X PTAX
The commercial dollar is the one that Poder360 and other newspapers report. The exchange rate is the main reference for the appreciation or devaluation of the real in relation to the US currency. It is negotiated from 9am to 5pm in the financial market between banks, brokers, investment funds and others.
The commercial dollar is used in commercial contracts between companies and in the export and import market.
The Ptax dollar is reported by the Central Bank and used as a reference by the monetary authority. The value is defined by a weighted average rate of “quotations determined by the BC based on consultations with foreign exchange dealers”according to the institution.
The BC consults the foreign exchange market and calculates the weighted rate to inform the quote, but the operation does not consider all currency fluctuations during the day. The rate is published daily in the afternoon, before the “closing” of the Brazilian foreign exchange market, when the trading desks close.
