INSUBCONTINENT EXCLUSIVE:
This marks a significant increase from $355 billion in December 2023.The growth stems from various factors, including asset appreciation and
The Central Bank of Brazil reports three main drivers behind this surge.First, asset price gains contributed $6.7 billion
Second, interest revenue added $6.4 billion
They help cushion against sudden shocks and currency crises
liquidity, and profitability, in that order
Reach Five-Year High: A Closer Look at Economic Stability
The Central Bank can use reserves to intervene in markets during disruptions.In 2024, there was only one spot dollar intervention
The bank sold $1.5 billion in August to balance an atypical capital outflow.Brazil maintains a floating exchange rate regime
Central Bank officials, including President Roberto Campos Neto, stress that interventions occur only during market dysfunctions.They
believe the exchange rate effectively absorbs shocks
Most of the reserves, about $299 billion, are invested in securities that generate returns.The majority is in U.S
dollar-denominated assets, accounting for roughly 80% in 2023
Campos Neto explains that the recent growth partly results from U.S
It provides a safety net against global financial turbulence
