Explaining the appreciation of the Brazilian real by Annabelle Mourougane published by OECD. “This paper seeks to identify factors explaining the appreciation of the Brazilian real observed since 2003, which was temporarily interrupted only during episodes of finantial turbulence. Net foreign assets and the productivity differential relative to Brazil’s main trade partners are found to be significant determinants of the real effective exchange rate in the long run. In the short term, exchange-rate developments are monstly explained by movements in net foreign assets.”
