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Currency-trading Losses - Brazil?


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Old 07-19-2009, 12:28 PM
agent agent is offline
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Default Currency-trading Losses - Brazil?

The quote below was in today's WSJ. Can someone pls elaborate on who is taking the currency losses? If the real falls, would Brazil actually earn more in the currency arena when selling commodities such as oil since that particular commodity is priced in Dollars?"But as investors pull out money, the real has plummeted against the U.S. dollar. That's led to huge currency-trading losses, shaking confidence in Brazil's commodity export sector".
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Old 07-19-2009, 12:57 PM
Amenda Amenda is offline
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Default Currency-trading Losses - Brazil?

As the currency goes down, a country that relies on commodities will become more competitive in the export arena, and imports will cost more. How it hits the bottom line depends on the difference between the two. Here in Australia, we have been hit by over 30% in the last month, so face the same issue. Petrol is higher, but we are possibly better off on our balance of trade because our mining income is higher.
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