Brazil's Real Gains as Buffett's Investment Eases Risk Aversion

By Adriana Brasileiro

Sept. 24 (Bloomberg) -- Brazil's real rose after Warren Buffett's Berkshire Hathaway Inc. agreed to invest $5 billion in Goldman Sachs Group Inc., easing concern U.S. vulnerability will hurt higher-yielding, emerging-markets assets.

``It's a good sign to see deals like this in an environment where confidence is still very, very weak,'' said Hideaki Iha, a currency trader at Fair Corretora in Sao Paulo. ``More liquid emerging-market currencies like the real are suffering a lot with the crisis.''

The real increased 1 percent to 1.8290 per dollar at 9:14 a.m. New York time, from 1.8465 yesterday. The gain pared September's loss to 11 percent. The real remains the biggest loser against the dollar among the 16 most-active currencies tracked by Bloomberg his month.

U.S. Federal Reserve Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson are due to give more congressional testimony today on a proposed $700 billion bailout of the financial system.

``Investors are waiting to see when and under what terms the U.S. Congress will approve the bailout package,'' Iha said.

The yield on Brazil's zero-coupon bonds due in January 2010 fell 4 basis points, or 0.04 percentage point, to 14.90 percent. The yield on the overnight futures contract for January delivery fell almost 2 basis points to 14.07 percent.

To contact the reporter on this story: Adriana Brasileiro in Rio de Janeiro at abrasileiro@bloomberg.net