Brazil’s swap rates plunged to a four-month low as dovish minutes from the central bank’s latest meeting led traders to cut bets on interest-rate increases.
Swap rates on contracts due January 2017 fell 0.2 percentage point to 14.5 percent as of 3:37 p.m. in Sao Paulo as the central bank signaled in minutes of its latest meeting that a weak domestic economy and global slump justify holding interest rates. The contracts have dropped 0.65 percentage point since the central bank surprised economists who had expected an increase in borrowing costs by keeping the benchmark at 14.25 percent at a meeting Jan. 20. The real jumped 0.7 percent to 4.0820 per dollar on bets that the Federal Reserve will refrain from raising interest rates anytime soon.
Brazil Energy Insight 
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