Dollar falls to lowest value since September.

SAO PAULO (Reuters) - The dollar recorded its third consecutive session of decline in Brazil on Monday, closing at its lowest value since September of last year, driven by the dispute among investors over the formation of the month-end and quarter-end Ptax rate and by the weakening of the US currency abroad.

The spot dollar closed down 0,88%, at R$5,4350, the lowest closing value since September 19 of last year, when it ended at R$5,4213. For the month, the currency accumulated a decline of 4,99%, and for the quarter, a drop of 4,76%.

The Brazilian foreign exchange market has been influenced since the start of the day by the dispute over the formation of the month-end and quarter-end Ptax rates.

Calculated by the Central Bank based on spot market quotations, the Ptax serves as a reference for the settlement of futures contracts. At the end of each month, financial agents try to direct it to levels more convenient to their positions, whether they are long (in the sense of rising quotations) or short in dollars (in the sense of falling quotations).

The dispute is especially intense at the end of the quarter -- as seen this Monday -- because the rate also serves as a reference for converting values ​​in foreign currency in the balance sheets and financial statements of many companies in Brazil.

Thus, the spot dollar even fluctuated in positive territory at the beginning of the day, reaching a high of R$5,5083 (+0,46%) at 9:39 am, driven by buyers, but in the Ptax collection windows it was the sellers who pulled the prices down. The Ptax collection windows are around 10 am, 11 am, 12 pm and 13 pm.

“We already had the first Ptax window with stronger sellers, pushing downwards, helped by external factors,” commented Jefferson Rugik, director of Correparti Corretora. “The dollar was losing ground against its peers, the real, and other currencies, with the prospect that the Federal Reserve may begin the process of cutting interest rates in the short term,” he added.

With the help of external factors, sellers pushed the spot dollar down to a low of R$5,4240 (-1,08%) at 12:54 pm, near the end of the Ptax collection window.

Despite the Ptax rate (R$5,4571 for sale) being established in the early afternoon, the spot currency remained in negative territory until the close, in a generally positive session for Brazilian assets, with a firm advance in the Ibovespa and a sharp drop in DI (Interbank Deposit) rates.

The international scenario was also favorable for most other currencies. At 17:24 PM, the dollar index -- which measures the performance of the US currency against a basket of six currencies -- was down 0,41%, at 96,798.

In the afternoon, the Firmus bulletin released by the Central Bank showed that non-financial companies in Brazil reduced their projections for the exchange rate in the next six months, but maintained their expectation that inflation in the coming years will remain above the center of the target.

The median expectation for the exchange rate six months ahead in May points to a dollar at R$5,80, compared to R$6,00 projected in the previous survey, from February.

In the Focus bulletin released this morning, the median projection from financial institutions for the dollar at the end of 2025 was R$5,70.