Brazil's Real Opens Stronger On Rising Investor Confidence

Brazil's Real Opens Stronger On Rising Investor Confidence

Brazil's real opened stronger against the U.S. dollar Thursday, maintaining its sharp gains Wednesday as investor confidence increases.

The real was stronger at BRL2.266 to the dollar on the Brazilian Mercantile and Futures Exchange, or BM&F, compared to Wednesday's close of BRL2.275.

Traders said the real was strengthening as investors continued to recover their appetite for risk, and on hopes that toxic bank assets in the United States may be isolated in a so-called "bad bank."

The real's strengthening to below BRL2.30 to the dollar Wednesday was for the first time since Jan. 12.

The Brazilian currency responded well Wednesday to rising commodity prices and international stock markets, as well as on the prospects for U.S. President Barack Obama's multi-billion economic stimulus package being approved by the House of Representatives.

The real also benefited Wednesday from foreign investment inflows into Brazil, which local traders estimated to be worth between $500 million and $700 million.