UPDATE 2-Brazil's Tombini says may reduce FX intervention in 2015

martes 16 de diciembre de 2014 13:20 GYT

(Adds Tombini comments on size of swap program, context)

By Luciana Otoni and Alonso Soto

BRASILIA Dec 16 (Reuters) - Brazil's central bank will keep intervening in the foreign exchange market next year but could reduce the scale of these operations, which are aimed at countering the slide in the country's currency, the real, which has stoked inflation.

Central bank chief Alexandre Tombini on Tuesday told reporters the bank will decide in coming days whether it will reduce the daily supply of currency swaps to as little as $50 million at the start of 2015 or keep it unchanged at $200 million.

Some investors had doubts on whether the bank would continue selling these swaps next year after Tombini had previously said the program has met its goals.

Still, his comments were not enough to fully ease investors' fears of additional currency losses. The real trimmed some losses after his comments but continued to trade around 2.73 per dollar, about 1.88 percent weaker from Monday's close.

In Brazil, currency swaps are derivatives that provide protection against losses in the real and mimic an injection of dollars in the futures market.

The sharp depreciation of the real, which touched near 10-year lows on Tuesday, is cited by the bank as one of the main reasons for quickening inflation.

Tombini said the bank will keep an eye on the secondary inflationary effects of a weaker real and rising regulated prices to prevent them from spreading to the rest of the economy.   Continuación...