The Brazilian foreign exchange market faced a significant devaluation in 2024, with the dollar ending the year at R$6.18, a .
The currency opened 2025 on a high, touching R$6.22 throughout the day, but ended up closing this Thursday’s session (2) in . Even so, experts estimate that the exchange rate should remain above R$6 during – at least – the first quarter of the year.
“It is to be expected that the exchange rate will soften, and that at the end of the first quarter it will be at a level, I will not call it an equilibrium level, but it is to be expected that the exchange rate will return to something around R$6.05, 6.10”, said Márcio Estrela, consultant at the Brazilian Foreign Exchange Association (Abracam).
The rise in the dollar worries productive sectors. With the currency at a high level, prices tend to rise in sectors such as retail.
In addition to increasing the cost of importing inputs, the depreciated exchange rate makes the foreign market more attractive for a series of sectors, such as agribusiness.
“For 2025, the recovery of the real will depend on a combination of factors. Structural reforms capable of attracting investment, combined with a more favorable external environment, could reduce exchange rate pressure”, says Einar Rivero, analyst at Elos Ayta.
The performance recorded by the real in 2024, placed the currency as analyzed in a survey carried out by Rivero.
The result was the worst for the Brazilian currency since 2020 and the third largest devaluation in nominal terms since 2010. The podium is completed by 2015, during the second term of then president Dilma Rousseff (-31.98%), and 2020, height of the Covid-19 pandemic (-22.44%).
“The performance of the real in 2024 illustrates the challenges faced by Brazil in an adverse global scenario and in the face of domestic uncertainties. The analysis of exchange rate fluctuations over the last 15 years highlights the inherent volatility of the Brazilian economy and reinforces the importance of consistent measures to guarantee stability and predictability for economic agents”, concluded Rivero.
Influences
According to experts, the main factor for the rise in exchange rates is the domestic scenario, with uncertainties about the fiscal sustainability of public accounts.
“The big question will come from Brasília, how the Executive, Legislative and Judiciary trio will work next year. Brasília is a surprise, anything that displeases you can do [o câmbio] get worse again”, asks Alexandre Cabral, professor at Saint Paul Escola de Negócios.
Another factor that influences the exchange rate is Donald Trump’s economic policy. , the Republican plans.
The effect of the movement could be a rise in inflation in the United States and .
“We have these different ‘little boxes’. The Trump ‘box’ is a question, we will have to wait for the rest of the year to understand how it could affect the Fed,” said Cabral, indicating the fear that the .
In December, the Central Bank (BC) held a series of spot dollar auctions to contain the depreciation of the real.
Márcio Estrela highlights that, after the period of greatest volatility, BC interventions tend to decrease, allowing the exchange rate to find its balance naturally.
“The Central Bank will not act to achieve a specific exchange rate, but to control volatilities arising from problems in the market”, concluded Estrela.
However, after a “season” of capital flight that occurs at the end of the year – due to taxes linked to payments of interest on equity (JCP) and dividends – and with the expectation that Brazilian agricultural exports will generate more dollars in circulation in Brazil, the professor at Saint Paul Escola de Negócios assesses that the real could be relieved in the face of negative pressures.
