Brazil's stocks bounced back slightly from a sell-off on Friday. At the Sao Paulo Stock Exchange, the benchmark Bovespa finished 0.16 percent higher at 33,247, according to preliminary data. It slumped Thursday after hitting record highs several times this week.
Bellwether Tele Norte Leste Participacoes, or Telemar, rose 0.07 percent to 42.45 reais, while state-run oil giant Petrobras, another investor favourite, edged up 0.03 percent to 36.31 reais.
The market has risen sharply this week as investors bet that the central bank will keep on cutting interest rates to revive a flagging economy.
Late Wednesday, the central bank lowered the base rate by a half percentage point to 18 percent, disappointing many investors who were hoping for a 0.75 percentage point reduction. It was the fourth reduction since September.
The real backtracked 1.65 percent to 2.337 to the dollar, its weakest close since September 5.
The currency has now lost more than 7 percent in the last eight days. With the real up almost 20 percent this year and near its strongest levels in 4-1/2 years, the central bank has been actively buying dollars to build up foreign reserves and selling currency swaps, which allow investors to buy exposure to Brazil's benchmark interest rate of 18 percent without buying reais on the spot market.
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