Financial markets across the whole of Latin America have been hammered over the past month by a euro-zone related flight to safety but amid the sell-off the collapse in the Brazilian real stands out. It has weakened by over 5% against the US dollar this month, and by over 15% since the end of February. What started as a currency war is now threatening to become a currency crisis. Indeed, the Brazilian central bank is now intervening in the market to prevent a disorderly fall in the real.
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