The Brazilian currency has been underperforming its peer group of emerging-market currencies, falling by 5% against the dollar in the past month; the Russian rouble has fallen 7% in the same period due to the impact of US sanctions.
However, there is a divergence of opinion about what is driving this weakness.
Ilya Gofshteyn, LatAm FX strategist at Standard Chartered, told Euromoney on his recent visit to the region that international investors tend to believe the uncertainty about who will emerge as Brazil’s next president later this year is putting downward pressure on the BRL.
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