Dollar closes stable day against real with market waiting for data and Fed By Reuters

By Fabricio de Castro

SÃO PAULO (Reuters) -The US currency closed on Monday practically stable in Brazil in spot negotiations, while the May contract fluctuated slightly lower, in line with the decline of the US currency abroad, with investors waiting for the agenda for the remainder of the week which includes the formation of Ptax on Tuesday and the Federal Reserve’s monetary policy decision on Wednesday.

The cash price closed the day at 5.1152 reais on sale, a slight drop of 0.03%. In April, the US currency accumulated an increase of 1.99%.

On a day with a relatively empty agenda, the US currency fluctuated within very narrow margins in Brazil this Monday. At the minimum exchange rate of the day, at 9:09 am, the dollar in cash reached 5.1029 reais (-0.27%) and, at its maximum, at 12:49 pm, it reached 5.1223 reais (+0.11%). The fluctuation from minimum to maximum was just 0.38% — a percentage much lower than what is seen on a daily basis.

Two professionals interviewed by Reuters considered that the lack of catalysts this Monday and the expectation for disclosures in the rest of the week hampered business in Brazil.

In fact, the week is full of indicators and events with the potential to drive prices, such as formal employment data (Caged) in Brazil and the US consumer confidence index on Tuesday; the Fed’s interest rate decision and the US Treasury’s announcement on financing needs on Wednesday; and the payroll jobs report and US Services PMI on Friday.

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On Tuesday there will also be a dispute over the formation of the end-of-month Ptax.

Ptax is an exchange rate calculated by the Central Bank based on spot market quotations and which serves as a reference for the settlement of futures contracts. At the end of each month, financial agents usually try to direct it to levels that are more convenient for their positions, whether long (in the direction of rising prices) or sold in dollars (in the downward direction).

At the end of this Monday afternoon, the dollar gave way against most other currencies abroad — with emphasis on the decline in relation to the yen, following reports of intervention by authorities to support the exchange rate.

In the Brazilian futures market, the dollar futures for May — the most liquid — also fell in the late afternoon, in line with the negative signal for the North American currency seen abroad.

At 5:04 pm, on B3 (BVMF:) the first maturity dollar futures contract fell 0.17%, to 5.1165 reais on sale.

The currency — which measures the performance of the US currency against a basket of six currencies — fell 0.33%, to 105.610.

In the morning, the Central Bank sold all 12,000 traditional currency swap contracts offered to roll over July maturities.

(Editing by Isabel Versiani and Alexandre Caverni)