Alarming projections for the dollar in Brazil: R$ 7,35 in 2021, says UBS.
Economists at the Swiss bank UBS released a worrying report with projections for the dollar in Brazil. The firm formulated three possible scenarios for the exchange rate of the US currency. In one of them, the currency would close the year near 6 reais and end 2021 around R$ 7,35.
247 - UBS projections have established a catastrophic scenario for the dollar in Brazil. The Swiss bank predicts that the dollar could reach R$ 7,35 by the end of 2021, a value that would put the Brazilian economy in intensive care, with several structural threats to markets and industrial production.
A report from the newspaper O Estado de S. Paulo It highlights that “the Swiss bank considered that trade performance is regressing to 2002 levels and that the interest rate differential (the difference between the Brazilian basic rate and that practiced in rich countries) is on a slight downward trend. Therefore, economists estimate that a fair price for the dollar would be R$ 4,60 this year and R$ 4,50 in 2021.”
The article further adds that “however, due to the pressure exerted by the current crisis situation, the bank set its base scenario with exchange rates of R$ 4,95 for 2020 and R$ 4,60 for 2021. In addition, as is customary, economists altered some variables in the base scenario to generate two other scenarios. In the most positive scenario, the dollar would fall to R$ 4,45 by the end of the year and to R$ 4,30 in 2021.”