Cheaper dollar makes search for exchange houses grow 25% in Brazil, says Abracam

The fall in the price of the dollar has moved Brazilian exchange houses in recent days, with a peak in demand.

This Monday (7), the US currency was sold at R$ 5.08 — an accumulated drop of 1.4% in the last week alone. In the year, the dollar fell by almost 9%, according to the Ibovespa.

A survey by the Brazilian Exchange Association (Abracam), obtained by the CNNshows that the demand for the dollar increased by 25% in the last ten days, the date of the beginning of the armed conflict in Eastern Europe.

The comparison was based on the same number of days before the start of the war in Ukraine.

The ‘race’ for the American currency came to zero stocks in some brokerages across the country. The scenario was even seen in large Brazilian cities, such as São Paulo and Rio de Janeiro.

However, according to Abracam, the situation was more relevant in the North and Northeast regions of the country, with emphasis on the capitals Fortaleza (CE) and Manaus (AM).

“Demand increased very abruptly due to the fall in the dollar, leading to a brief shortage in some specific locations. However, this trend has already been reversed and has been diligently equalized by financial institutions”, explained Kelly Massaro, president of Abracam.

Pressured by the appreciation of commodities globally, especially oil and iron ore, the dollar continues to depreciate against the real.

The destabilization of the US currency is also due to the uncertainties generated by the war between Russia and Ukraine.

Another reason that benefits the appreciation of the real is the high interest rate in Brazil, which attracts international investors.

However, the downtrend may not last for long. That’s because the confrontation and the chances of new escalations of war increase the search for the dollar and investors’ aversion to risks. In this way, the currency can return to record high.

in conversation with the CNNPierre Souza, finance professor at FGV, endorsed the possibility of a new growth trend for the dollar over the next few weeks.

“Since December, we have already seen a drop in the price of the dollar in Brazil, mainly due to the high interest rates in the country. In the short term, the move has been intensified by Ukraine as investors can look to emerging markets and further away from this conflict in Europe,” he said.

“Yes, there is this migration of short-term capital. But, in the future, the tendency is for investors to look for more stable markets, such as the United States, migrating to the stronger currency, the dollar”, concluded Souza.