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LatinNews Daily - 25 June 2021

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In brief: Brazil’s real strengthens

* The Brazilian real has appreciated against the US dollar, closing the day at R$4.90/US$1 yesterday (24 June), its strongest point since 9 June 2020. The real, which was one of the worst performing emerging market currencies in 2020 but has been strengthening over the second quarter of 2021, rose past the R$5/US$1 mark on 23 June for the first time in over a year. A weaker dollar and the short-term effects of the Brazilian central bank’s (BCB) monetary policy moves can help explain the real’s recent gains, but questions surrounding future economic reforms are likely to dim prospects for the foreign exchange rate in the medium term.