By Adriana Brasileiro and Joao Oliveira
Nov. 18 (Bloomberg) -- Brazil's real fell for a second day on speculation that a global recession will reduce demand for local export products and financial assets.
``These conditions make it very hard for investors to have the necessary parameters to invest in our markets,'' said Paulo Celso Nepomuceno, a strategist who helps manage about 450 million reais ($193.8 million) in assets for Coinvalores SA in Sao Paulo.
The real weakened 1.4 percent to 2.3212 per dollar at 7:40 a.m. New York time, from 2.2891 yesterday. Brazil's currency has depreciated 29 percent in the past three months, the worst performance among the 16 major currencies tracked by Bloomberg.
Stocks in Europe and Asia fell for a second day, led by commodity producers and financial companies on concern profits will be hit by the deepening recession. U.S. index futures declined.
Brazil's central bank stepped up measures to shore up the currency. The bank will offer as many as 10,000 currency swap contracts at an auction today, part of a daily effort to offer liquidity to the market. The central bank will also offer as many as 73,100 currency swaps today in a separate auction as it seeks to roll over about $3.7 billion worth of contracts coming due on Dec. 1. The bank is offering contracts maturing in January, March and October 2009, and in January 2010.
Banco Central do Brasil has spent $46 billion in the local currency market to support the real with dollar sales and loans to exporters, central bank President Henrique Meirelles said yesterday.
The yield on Brazil's zero-coupon bond due in January 2010 fell 11 basis points, or 0.11 percentage point, to 15.21 percent, according to Banco Votorantim. The yield on Brazil's overnight futures contract for January 2009 delivery rose one basis point to 13.56 percent.
To contact the reporters on this story: Adriana Brasileiro in Rio de Janeiro at abrasileiro@bloomberg.net; Joao Oliveira in Sao Paulo at Joliveira4@bloomberg.net
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