The Brazilian economy is facing a fiscal and confidence crisis that has led the Central Bank of Brazil to sell USD 32.5 billion in reserves in the last 30 days to prevent the dollar from rising above 6.20 reais. This situation directly affects Argentina, as Brazil is its main trading partner. The depreciation of the real makes Brazilian products cheaper, increasing competition for Argentinean exports and negatively affecting the trade balance. Moreover, economic uncertainty in Brazil may influence regional financial stability, generating market volatility and possible capital outflows that impact neighbouring economies. Link to article
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