Monthly FX Bulletin – January 2025

January 27, 2025 edition of the TCP / VNCFX FX bulletin, reviewing December and the outlook for 2025. The real ended 2024 down 27.3%, and the dollar hit a record R$6.29 despite US$30.7 billion in Central Bank interventions; the Selic rose to 12.25%, with 14.25% signaled, and 2024 inflation closed at 4.83%. The document highlights the EU-Mercosur agreement, political and fiscal uncertainty and external risks (Trump and China), warns that without fiscal adjustment Brazil risks repeating the 2015 crisis, and suggests hedging for importers.