The Brazilian real has remained strong against the US dollar, with central bank foreign exchange intervention and key support from commodity exports

In May 2025, the Brazilian real rose to 4.85 against the US dollar, reaching its highest point since April of this year. The market generally believes that this rebound is mainly due to three aspects: firstly, the rebound in global commodity prices has led to an improvement in export expectations; Secondly, the intervention of the Brazilian central bank in the foreign exchange market effectively suppresses speculative selling; Thirdly, investors have regained confidence in emerging market currencies.

Recently, the prices of iron ore and soybeans have risen by 7% and 4% respectively, directly boosting Brazil's expectations for foreign exchange earnings. In terms of the capital market, the central bank has sold US dollars through the spot market for three consecutive weeks, totaling over 3 billion US dollars, effectively suppressing the rapid depreciation of the exchange rate.

At the same time, Brazil's interest rates remain high, with the current benchmark rate at 10.50%, ranking high among major emerging economies and attracting some arbitrage funds to flow back. JPMorgan Chase stated in its report, "The strong rebound of the real indicates that the market is correcting its excessive pessimism towards emerging markets

However, some analysts have warned that the appreciation of the real is still fragile, and future movements of the Federal Reserve, fluctuations in commodity cycles, and domestic fiscal pressures may still pose medium - to long-term challenges.