By Drew Benson
Oct. 24 (Bloomberg) -- Brazil's real dropped as global stock markets plunged and trading in U.S. futures was limited amid widespread flight from higher-yielding, emerging-market assets.
The real slid 4.4 percent to 2.367 per dollar at 9:31 a.m. New York time, from 2.2608 yesterday.
The central bank bought reais for dollars at a rate of 2.35 per dollar in a bid to shore up the currency during a 10-minute window that opened at 8:53 a.m. New York time. The bank also said it will offer 40,000 currency swaps today. With them, the bank sells the U.S. currency in the futures market, allowing investors to hedge against a weaker real.
``Overall risk reduction amidst concerns about global recession and talk of position liquidations by troubled funds that may already have suffered losses this week on the emerging- markets tumble are contributing to the move'' worldwide to the U.S. dollar and the Japanese yen, said New York-based Marc Chandler and Meg Browne of Brown Brothers Harriman in a research note.
The real's decline erased a rebound yesterday sparked by a central bank announcement that it will pump the equivalent of $50 billion into currency markets, its biggest move yet to bolster the currency.
The real has tumbled 31 percent from a nine-year high on Aug. 1.
To contact the reporter on this story: Drew Benson in Buenos Aires at Abenson9@bloomberg.net
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