Economists are more in agreement than they have been since 2014 about where Brazil’s currency is heading after a political crisis unseated President Dilma Rousseff.
The newfound stability has reduced the cost of protection from one of the world’s most volatile exchange rates in recent years, offering relief for companies struggling in a recession and making it easier for foreigners to buy into Brazilian markets.
Nearly all of the roughly 100 economists in Brazil’s weekly central bank poll now forecast the exchange rate to end 2016 between 3.36 reais and 3.96 reais to the dollar, the narrowest band since March 2014, according to Reuters calculations based on the data’s standard deviation.
That spread is half the year’s widest, which came on April 1, two weeks before Brazil’s lower house voted to oust Rousseff on charges that she broke budget laws. Estimates for the year-end exchange rate rarely tighten so sharply before the final months of the year.