Brazil’s industrial output in November dropped by 1.2% compared to the same time last year. This decline was more significant than the expected 0.1% drop, showing weaker industrial activity than forecasted. In the currency market, the Japanese yen remained steady, with less volatility. The British pound saw a small decrease as it continued to stabilize after a recent rise.

Euro Holds Steady Against US Dollar

The euro stayed stable against the US dollar, thanks to unexpected increases in factory orders. On the other hand, the Canadian dollar weakened further as the US dollar had a strong rebound. Gold prices faced pressure due to the US dollar’s strength. The euro also dipped slightly as steady US jobless claims supported the dollar. For 2026, we suggest various brokers for forex trading. These brokers offer low spreads and high leverage. You can find detailed reviews for brokers tailored to different regions and trading styles. Legal information from FXStreet explains the risks involved in financial markets. Readers should do their own research before investing, as the platform does not offer investment advice. Users are responsible for any errors or omissions in the data provided.

Brazil’s Economic Outlook

The November 2025 industrial output number showed a slowdown that we had anticipated. The reported decline of 1.2% year-over-year missed the expected -0.1% significantly. While this data is already priced into the market, it indicates a bearish outlook for Brazil’s economy as we move into the new year. During the last quarter of 2025, Brazil’s benchmark Ibovespa index surprisingly rose over 15%. However, the latest inflation report for December revealed high consumer prices at 4.6%, making it difficult for the central bank to cut rates and stimulate the economy. This contrast between a strong market and a weakening economy creates uncertainty for the upcoming weeks. This economic scenario puts pressure on the Brazilian Real, especially since the US dollar has strengthened globally. Traders might want to consider using options to prepare for a possible decline in the Real compared to the dollar. Call options on the USD/BRL pair could be a low-risk way to profit if the currency continues to weaken in early 2026. The rise in Brazilian stocks at the end of the year seems disconnected from the weak industrial data. For those with long positions, buying put options on a broad market ETF may serve as an affordable insurance against a potential market correction. This is a wise strategy before new economic data is released. Important dates to watch include the upcoming release of December’s industrial production figures and the central bank’s next policy meeting minutes. We expect implied volatility on Brazilian assets to increase as these events approach. Using derivatives that benefit from price fluctuations, regardless of direction, could be a smart trading strategy given the anticipated uncertainty. Create your live VT Markets account and start trading now.

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