Brazil’s real currency is expected to remain relatively stable in the coming months, according to a recent Reuters poll. Concerns about the country’s external accounts are likely to keep the currency in check, despite some positive factors supporting it.
The real has performed better than expected so far in 2025, thanks to higher local interest rates and a weaker U.S. dollar globally. However, doubts among investors about Brazil’s ability to finance its current account deficit have added to concerns about the fiscal deficit.
Analysts predict that in 12 months, the real will only depreciate by 1.9% to 5.75 per dollar, compared to its current value of 5.64. This forecast is more optimistic than previous estimates, reflecting the currency’s resilience in the face of economic challenges.
Factors supporting the real include Brazil’s favorable interest rate spread and hopes for progress in trade talks between the United States and China. However, uncertainties surrounding domestic fiscal policies and external account dynamics may limit the currency’s upside potential.
Challenges for Brazil’s exporters, such as a decrease in poultry shipments due to an avian influenza outbreak and lower Chinese soybean imports, could also impact the real’s performance in the coming months.
Looking at other currencies in the region, the Mexican peso is expected to strengthen slightly, while Argentina’s peso is forecast to trade at 1,440 per dollar in 12 months. Despite some volatility, the real has gained 9.6% so far this year, outperforming the Mexican peso and Argentina’s peso.
Overall, the outlook for Brazil’s real remains uncertain, with a mix of positive and negative factors influencing its value. Investors will need to closely monitor developments in the country’s economy and external accounts to gauge the currency’s future performance on the global stage.
