Tumbling currency impact on travel trade in Brazil

Global Business

The Brazilian Real has been rising against the U.S. dollar in recent months.

Analysts have said that has to do with signs the country’s economic troubles may be easing and an increasing confidence in its future.

The currency shift is making it cheaper for Brazilians to travel abroad and many are taking the opportunity.

CCTV America’s Paulo Cabral reports.

Tumbling currency impact on travel trade in Brazil

Tumbling currency impact on travel trade in Brazil

The Brazilian Real has been rising against the U.S. dollar in recent months. CCTV America's Paulo Cabral reports.
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After reaching a peak of more than 4.1 Brazilian Reais per dollar in September 2015, the local currency dropped steeply following the impeachment of President Dilma Rousseff in May – maintaining a level of around 3.3 Reais per dollar since early July.

In the offices of Brazil’s largest tour operator, the appreciation of the local currency has led to a renewed interest in international travel.

Officials with the CVC travel group said the number of its bookings abroad dropped more than 10 percent as U.S. dollar was going up.

The appreciation of the Brazilian real is great news for some sectors like international travel, as well as trade if you’re talking imports. But if the local currency keeps going up, it could have a negative impact on trade’s flipside: exports.

Brazil’s sales abroad are still going up as the exchange rate remains favorable and cheaper imports help to fight inflation.

The appreciation of the Brazilian Real is seen as sign of trust in the country’s chances for economic recovery. Key to achieving that end-will be maintaining an exchange rate that will keep most sectors in balance.