On Friday, the 7th of February 2020, over the non-competitive narratives of a strong American currency alongside growing concerns regarding China’s coronavirus outbreak, emerging market currencies alongside equities went through an en masse downward slide, while the Brazilian real had hit its all-time low of 4.32 against the greenback on record.
In point of fact, since a growing death toll from China’s Wuhan coronavirus epidemic had been battering investors’ optimism and global demand outlook, the Brazilian real fell by 0.9 per cent to 4.3204 against its American counterpart, clocking six straight weekly decline in a row as the Brazilian Central Bank decided against intervening in to the FX market.
Meanwhile, casting further holocaust on Brazilian Real outlook over the coming weeks, an analyst at Commerzbank, You-Na Park-Heger wrote in a client note on Friday (February 7th), “The historically low-key rate remains a burdening factor for the BRL, especially since the real interest rate is now close to zero.
We therefore see no scope for a recovery in the BRL for the time being. ” Aside from the steep downward spiral of Brazilian Real on Friday’s (February 7th) FX market, MSCI’s index of emerging market currencies were tottered 0.7 per cent to report its worst intra-day decline in six months, while MSCI’s index of emerging market stocks shrugged off 1.19 per cent on Friday’s (February 7th) market round off.