Brazilian Real Hits Record Low Amid Fiscal Policy Concerns

Investors question Lula's budget measures as Brazil's currency and markets face significant pressure.

The Brazilian real fell to 6.26 per dollar, its weakest level since the currency's introduction in 1994, marking a 23% decline against the U.S. dollar this year.
President Lula's proposed 70-billion-real budget cut plan has been criticized by investors as insufficient to address Brazil's fiscal challenges.
Brazil's lower house of Congress approved parts of the fiscal bill, but key measures, including wage restrictions, remain undecided as Congress nears its recess.
The central bank has intervened in currency markets and maintained a tight monetary policy, but these efforts have not stabilized the real's decline.
Economic analysts warn that the real's depreciation could drive inflation in early 2025, with broader concerns about Brazil's fiscal trajectory and market stability.