SÃO PAULO—The Brazilian real reached its weakest level since 2004 in midday trading Thursday as concerns about the country’s struggling economy and political problems pushed investors to buy dollars.
The real traded at 3.001 to the dollar at 12:06 p.m. São Paulo time, according to Tullett Prebon via FactSet, after approaching the 3.000 level several times Wednesday and earlier Thursday. At 12:28 p.m. the real was trading at 2.9964. The real closed at 2.9812 on Wednesday.
Brazil’s already sluggish economy will contract in 2015, according to economists surveyed by the country’s central bank, as the government raises taxes and cuts spending and consumers also spend less.
Adding to Brazil troubles is a continuing investigation into an alleged kickbacks and bribery scheme at state-owned oil company Petrobras. Brazil’s Supreme Court is expected to reveal the names of politicians implicated in the scam as early as Friday.
Uncertainty about the investigation and its possible effects on the government are also spurring sales of the real.