Dollars Are Flowing Back Into Brazil After Record Exit

Money is coming back to Brazil. The country recorded $6.6 billion in net foreign exchange inflows through February 13, according to preliminary central bank data released Thursday. The figure marks a dramatic reversal from 2025, when Brazil suffered its second-largest dollar outflow on record — $33.3 billion for the year.

January alone accounted for $5.1 billion of the inflow. February through the 13th added another $1.5 billion, though the financial channel turned slightly negative in the month with $181 million in net outflows, offset by a $1.7 billion trade surplus.

What is driving the reversal

The financial channel — which tracks foreign direct investment, portfolio flows, profit remittances, and interest payments — has recorded $6 billion in net inflows year-to-date. In 2025, that same channel bled $82.5 billion, the second-worst reading in the historical series, as companies rushed to remit dividends abroad before a new tax on international transfers took effect in January 2026.

Now, with Brazil’s benchmark Selic rate at 15% — the highest since 2006 — and the U.S. dollar weakening globally, foreign investors are rotating capital back into Brazilian assets. The Ibovespa stock index has climbed more than 15% year-to-date and briefly touched 190,000 for the first time. The real has strengthened roughly 16% against the dollar over the past year.

Trade adds a cushion

The commercial channel added $514 million in net inflows for the year through February 13. Exports totaled $29.4 billion against $28.9 billion in imports. Within exports, advance contract payments and prepayments accounted for $9.1 billion — a sign that foreign buyers are locking in Brazilian commodities early.

What comes next

The central bank’s rate-cutting cycle, widely expected to begin at the March Copom meeting, could test this inflow trend. Markets are pricing 50-basis-point cuts at each of the seven remaining meetings this year, which would bring the Selic to around 11.5% by December — still among the highest real interest rates in emerging markets.

Whether the inflow momentum holds will depend on the pace of easing, the trajectory of the dollar, and whether Brazil’s fiscal discipline survives an election year. For now, the money is voting with its feet. This is part of The Rio Times’ daily coverage of Latin American markets and financial news.