English 
Português do Brasil In recent years, the US dollar has shown extreme behavior in relation to the Brazilian real. In 2024, the US currency ended the year with an appreciation of approximately 27%, while in the first quarter of 2025 it already registered a drop of 7.65%. This volatility directly affects a range of sectors – from tourism and investments to the cost of living for Brazilians. But the most significant impact is felt by those involved in foreign trade.
For importing and exporting companies, abrupt variations in the dollar exchange rate represent a constant risk, as they directly influence costs, pricing, and even the viability of certain operations. In this article, you will understand what drives dollar fluctuations, how this interferes with international operations, and what strategies can be adopted to mitigate their effects.
What makes the dollar rise or fall?
Exchange rate fluctuation is not determined by a single factor. The dollar, like any financial asset, responds to a series of economic, political, and even emotional market variables. Below, we list the main factors that influence the currency's value:
1. Supply and demand for dollars in Brazil
The dollar functions like any other product: when it's scarce, the price goes up; when there's abundance, it tends to fall. The inflow and outflow of dollars from the country are directly linked to the trade balance, foreign investments, and other financial flows.
• Exports bring dollars into the country, increasing supply and generally decreasing the exchange rate.
• Imports generate demand for the currency, which can push the dollar higher.
2. Domestic and foreign interest rates
International investors seek returns. When interest rates in the United States rise, there is a natural movement of capital withdrawal from emerging countries – like Brazil – to safer investments in the American market. The result: more demand for dollars, which increases their value.
3. Political and economic uncertainties
Political crises, fiscal problems, international conflicts, wars, and sudden changes in the economic scenario directly affect investor confidence. In times of instability, the dollar is seen as a safe haven, and therefore, its value tends to rise.
Impacts of exchange rate volatility on imports and exports
Companies operating in foreign trade feel the effects of exchange rate volatility most directly. Both importers and exporters need to constantly adapt to dollar fluctuations to protect their financial results.
For Importers:
• Falling dollar: Makes buying products and inputs from abroad more advantageous. The cost of imports decreases, which can increase profit margins or allow for price reductions to the final consumer.
• Rising dollar: Significantly increases the cost of imports. Products like chips, machinery, and electronic components – which Brazil does not manufacture – weigh more heavily on the budget. This can make business unviable and increase inflation in the domestic market.
For Exporters:
• Appreciated dollar: Favors Brazilian exports, as products become cheaper and more competitive in the international market.
• Falling dollar: Can make Brazilian products more expensive abroad, hindering foreign sales. Furthermore, many exporters use imported inputs, which can create a mixed effect on production costs.
Volatility makes planning difficult
The biggest problem with dollar fluctuation is unpredictability. Companies that operate with shipping deadlines and future contracts need to deal with the risk of abrupt variations that can affect:
• International freight costs (usually quoted in dollars or euros);
• Taxes based on customs value in foreign currency;
• Additional logistical costs such as demurrage and detention, also charged in foreign currencies
This makes financial planning more difficult and risky, directly impacting the profitability of international operations.
How to protect yourself from dollar fluctuations?
While it's not possible to control the behavior of the foreign exchange market, there are effective strategies to reduce exposure to volatility. The main one is currency hedging.
What is Currency Hedging?
O hedge cambial é uma ferramenta financeira utilizada para proteger contratoscontra as variações da taxa de câmbio. Ao utilizar o hedge, a empresa “trava” a cotação do dólar em uma data futura, reduzindo o risco de perdas.
Among the most commonly used modalities are:
• Forward contract (NDF – Non-Deliverable Forward): An agreement between two parties to fix the exchange rate of a currency on a specific date.
• Currency swap: An exchange contract between the variation of the exchange rate and the variation of the interest rate. Ideal for companies with currency exposure combined with financial operations.
Furthermore, it is essential to rely on a specialized team or consultancy to monitor the macroeconomic scenario and assist in making strategic decisions.
Conclusion
Dollar volatility is a factor that Brazilian companies operating in international trade must live with. Although it is not possible to accurately predict market movements, it is possible to manage risks and protect your operation with financial intelligence and planning.Understanding the mechanisms behind exchange rate fluctuations and adopting strategies like hedging can make all the difference between a profitable operation and an unexpected loss.
Avoid mistakes when importing!
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