Brazil: Real Rises to Over 2-Year High.

The Brazilian real strengthened to 4.95 per dollar, the strongest level since March 2024, amid support from higher oil prices and the outlook of high interest rates. The ongoing conflict between Iran and the US has suspended oil flows from the Middle East for nearly two months, lifting global energy prices and increasing foreign exchange inflows for alternative energy exporters such as Brazil. *On top of that, the pro-inflationary risks from higher energy prices drove officials in the Central Bank of Brazil to suspend the outlook of multiple rate cuts signaled before the war, boosting foreign investment in Brazilian fixed-income assets. These developments were enough to strengthen the currency despite of the flight to harder assets that typically occur with geopolitical tensions.