Dollar Holds Near R$5.39 As Payroll And Brazil Inflation Loom

Key Points

1. The real steadied around R$5.388 per dollar early Friday after a quiet but firm Thursday close.
2. U.S. yields and a stronger dollar index set the tone, with payroll the next catalyst.
3. Brazil’s soft industry data keeps domestic nerves high ahead of the IPCA print.

The dollar is starting Friday pinned near R$5.388, after trading an early band around R$5.3748 to R$5.3967. The level looks calm on screens. The reasons behind it are not.

On Thursday, the onshore dollar closed at R$5.3890, up 0.04%. Traders framed it as a classic “wait for the data” session. Yet the bias was clear.

The dollar index was firmer near 98.9, and U.S. 10-year yields hovered around 4.18%. That combination tends to squeeze high-carry currencies before major U.S. releases.

Two U.S. data points helped keep rates elevated. The October trade deficit shocked by shrinking 39% to $29.4 billion, the lowest since 2009.

Weekly jobless claims came in at 208,000, still consistent with a job market that is slowing only gently. With policy makers already cautious, the market leaned toward a longer pause. Rate-cut expectations shifted toward later in the spring.

Now attention turns to the official U.S. payrolls report, due Friday at 10:30. For Brazil, the second gate is inflation. The IPCA release is the key local trigger after November industrial output was flat on the month and down 1.2% from a year earlier.

Industry remains 14.8% below its 2011 peak. One economist, André Valério of Inter, blamed a double drag: high domestic rates and U.S. tariffs that still leave a 50% surcharge on many industrial exports.

Flow signals were active even without drama in spot. B3’s mini dollar future (WDO), a $10,000-notional contract, traded roughly 1.80 million contracts on Thursday.

EWZ, the main Brazil equity ETF, changed hands about 17.8 million shares. In the U.S., ETF creations were still heavy, with about $42.8 billion added in the week ending Jan. 2.

Technically, USD/BRL is trying to base. On the 4-hour chart, RSI sits near 36.6 while MACD has started to turn up. Support clusters at R$5.36–R$5.37.

Resistance sits at R$5.40–R$5.42. The daily RSI near 41.8 points to stabilization, not a reversal. The week has ranged roughly R$5.37 to R$5.45 and is down about 0.6%.

Oil adds a twist. Brent is in the low $62s, boosted by fresh Venezuela and Iran risk. That helps Brazil’s external accounts but can also raise global risk premia—another reason traders are keeping positions light into the next prints.

This is part of The Rio Times’ daily coverage of the Brazilian real exchange rate and Latin American financial markets.

For B3 equity market context, see The Rio Times’ Ibovespa session report for the same date.

For the macro context, see Brazil’s Morning Call for the same date.