SAO PAULO (Reuters) – Brazil’s central bank said on Friday it would hold auctions starting on Monday to roll over $15.6 billion in traditional currency swaps expiring on April 1.
The central bank said in a statement that daily traditional swap auctions would be held as long as necessary for the expiring stock to be fully renewed.
In a traditional currency swap, the bond pays the buyer the currency variation plus an interest rate. In return, the central bank receives the variation in the Brazilian benchmark interest rate, the Selic.
The central bank usually seeks to provide currency hedging and maintain liquidity conditions for the market with its rolling policy.
(Reporting by Fabricio de Castro; Writing by Andre Romani; Editing by Will Dunham)
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