Currencies
Real’s Worst-in-World Currency Slide Attracts a Specific Kind of Bear
- Funds increased positions to over $70 billion on Tuesday
- Brazil swap rates up more than 80 basis points since April 9
The Brazilian flag in Balneario Camboriu, Brazil.
Photographer: Maira Erlich/BloombergThis article is for subscribers only.
Foreign funds are stepping up bets against the Brazilian real, turning the currency into the worst major performer in the world amid a mix of negative local news and a massive repricing of the outlook for global interest rates.
The real is down 4.5% this month, by far the weakest showing among all major currencies tracked by Bloomberg. Using derivatives, foreign funds have added the equivalent of $9.4 billion in real shorts since April 9, increasing positioning against the currency to $70.3 billion on Tuesday. That’s the highest level going back to at least 2012.