* Central bank could hold several surprise forex auctions
* Measures may also include sale of reverse swaps
* Japan’s forex intervention prompted more Brazil action
SAO PAULO, Sept 17 (Reuters) - Brazil’s central bank will likely intensify its foreign exchange interventions with surprise daily auctions to buy excess dollars in the spot market, up from just two now, O Estado de S. Paulo newspaper reported on Friday, citing an unnamed government source.
“The order is to buy, buy and buy,” the government source told Estado.
The more aggressive measures could also include the sale of reverse currency swaps if investors continue to raise short bets against the dollar in futures markets, Estado said.
The focus on a more hard-line central bank approach was an answer to the massive intervention by the Bank of Japan on Wednesday that totaled an estimated $21 billion, Estado said, citing comments from the Brazilian government source.
Brazil's currency, the real, BRBYBRL= has rallied nearly 5 percent since the end of June, making the country's exports less competitive in global markets and also stoking demand for imports.
The central bank had been holding one auction a day for several months, but last week began calling two daily auctions to buy dollars in the spot foreign exchange market in a bid to soak up large volumes of the U.S. currency flowing into Brazil. The bank has bought $815 million in the spot market so far in September, including almost $600 million over Thursday and Friday last week, according to its most recent data. (Reporting by Elzio Barreto; Editing by Chizu Nomiyama)