The spot dollar closed down 0,35%, at R$ 5,3197 for sale.
There are fears that there could be a partial shutdown of the US government.
By Fabricio de Castro
SAO PAULO (Reuters) The dollar weakened again against the real on Monday, in line with the decline of the US currency abroad, amid fears of a possible partial shutdown of the US government if the US Congress does not reach an agreement on the budget by Tuesday.
The spot dollar closed the session down 0,35%, at R$5,3197. Year-to-date, the currency has fallen 13,91%.
At 17:04 PM on the B3 exchange, the dollar for October – currently the most liquid in Brazil – was down 0,58%, at R$5,3240.
The dollar began losing ground against the real early in the session, following the negative trend from abroad, where the US currency weakened amid the risk of a US government shutdown. Even though the funding is about to expire on Tuesday, Republicans and Democrats in the US Congress are showing no signs of agreeing on a temporary solution for the spending cuts.
In this scenario, the spot dollar reached a minimum rate of R$5,3052 (-0,63%) at 10:42 AM, following the decline of the currency against most other currencies abroad. For the remainder of the session, the dollar recovered some strength, but still ended lower against the real.
Among the day's events, highlights include comments from the president of the Central Bank, Gabriel Galípolo, during the Itaú Macro Day event in São Paulo.
Galípolo ruled out changes to the institution's current approach regarding foreign exchange reserves and swap holdings, reiterating that the exchange rate in Brazil is floating and that the institution is working to correct dysfunctions.
"There is no objective or concern regarding the replenishment of reserves or changes in swaps," said Galípolo, adding that the Central Bank has robust reserves to respond to any dysfunction in the foreign exchange market.
When questioned about the current deficit in Brazil's current account, Galípolo stated that the result demonstrates that domestic demand remains high.
At the same event, Finance Minister Fernando Haddad stated that the government is not making fiscal adjustments by selling assets, adding that it will continue to pursue the established fiscal targets for both 2025 and 2026.
"The goal of the Budget Guidelines Law... is being pursued with every effort," Haddad stated regarding the 2025 objective. "It will be the same for 2026," he added.
Abroad, in the late afternoon, the dollar continued to fall. At 17:11 PM, the dollar index -- which measures the performance of the US currency against a basket of six currencies -- was down 0,20%, at 97,952.
(Edited by Pedro Fonseca)
