| RIO DE JANEIRO
RIO DE JANEIRO Nov 21 The Brazilian real opened
weaker as global risk aversion grew on Wednesday, with investors
likely to test the central bank's willingness to intervene in
the currency market to halt the currency's depreciation.
The real weakened 0.6 percent to 2.0927 per
dollar, nearing the ceiling of a narrow trading range of 2.0-2.1
per greenback set by the central bank since July.
"Our view is unchanged: we still see the real to test the
2.10 (level) soon," Citigroup strategists wrote in a research
Brazilian policymakers have favored a real weaker than 2 per
dollar in order to support the country's industry. At the same
time, a much weaker currency could further spur inflation, which
is already running above the center of a government target
In the past several months, the central bank has resorted to
a series of traditional and reverse currency swap auctions --
which emulate, respectively, the sale and the purchase of
dollars in the futures market -- to keep the currency within the
2.0-2.1 reais per dollar range.