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Brazil central bank to auction up to $1 billion with repurchase deal

BY Reuters | ECONOMIC | 07/11/25 07:05 PM EDT

SAO PAULO, July 11 (Reuters) - Brazil's central bank will sell up to $1 billion in a dollar auction with repurchase agreement on July 15, it said in a statement on Friday.

The auction will start at 10:30 a.m. local time (1330 GMT) on Tuesday, the central bank said, adding the repurchase is set for November 4.

In recent months, the central bank has been promoting

auctions

to roll over maturities scheduled for the beginning of each month.

The auction announced on Friday targets the rollover of the maturities set for August 4 - the business day following the start of the United States' 50% tariff on products sold by Brazil, which begins on

August 1

.

The tariff announcement on Wednesday brought

volatility

to the Brazilian foreign-exchange market, with the spot real closing on Friday with 2.28% weaker against the dollar. (Reporting by Isabel Teles; Editing by Sarah Morland and Kylie Madry)

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

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