Dollar has slight real swings with Social Security and BC

© Reuters. Funcionário de uma casa de moedas mostra notas de dólar após contá-las em Ciudad Juarez, México

The dollar was mildly wavering against the real on Friday after rising sharply for two trading sessions amid heightened concerns about the ability of the government of President Michel Temer to gain political support to pull welfare reform out of paper.
The return of the Central Bank to the foreign exchange market helped to contain bullish movements in this session.

At 11:19, the dollar was down 0.14 percent, to 3.2666 reais on the sale, after climbing 1.96 percent in the previous two sessions. The dollar futures had low light of 0.20 percent.
"The dollar is near a ceiling in a more pessimistic scenario, but it could go above 3.30 reais if the reform is postponed or the government throws in the towel," said Miriam Tavares, director of foreign exchange at AGK Corretora.

The news got more negative this week as the government struggled to get the support it needed to put the reform text on the ballot soon. Not less, the dollar jumped from the level of 3.20 reais to 3.27 reais in recent days.

The president of the Chamber of Deputies, Rodrigo Maia (DEM-RJ), had said that there were still many votes to reach the 308 needed to pass the Constitutional Amendment Proposal (PEC) in the House.

On Saturday, Temer will meet with the governor of São Paulo and likely future president of the PSDB, Geraldo Alckmin, to discuss the support of the toucans to the matter. The next day, the president will be the main guest of a dinner, to be promoted by Maia with leaders and presidents of parties in search of support.

The recent movement of the dollar against the real was contained in this session by the BC, which announced the resumption of currency swap auctions - equivalent to the future sale of dollars. There will be 14,000 contracts at this morning's auction, and if this pace is maintained and you sell all the lots per day during December, you will be able to roll over the whole January maturity of $ 9.638 billion.

The Central Bank did not operate in the market in the last two months because there were no swap maturities. In September, when it did the last performance, the BC rolled only 6 billion dollars out of the total of 9.975 billion dollars winning the following month.