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This excerpt taken from the PBR 20-F filed May 22, 2009. Exchange
Rates
Subject to certain procedures and specific regulatory
provisions, there are no limitations to the purchase and sale of
foreign currency and the international transfer of reais
as long as the underlying transaction is valid. Foreign
currencies may only be purchased through financial institutions
domiciled in Brazil and authorized to operate in the exchange
market. We cannot predict whether the Central Bank or the
Brazilian government will continue to let the real float
freely or will intervene in the exchange rate market through a
currency band system or otherwise.
The real appreciated 8.1% in 2004 against the
U.S. dollar and continued to appreciate 11.8% in 2005, 8.7%
in 2006 and 17.2% in 2007 and 10.1% in the first half of 2008.
Beginning in the second half of 2008, the real greatly
depreciated against the U.S. dollar. The real
depreciated 31.9% against the U.S. dollar in 2008. As
of May 20, 2009, the real has appreciated to R$2.020
per U.S.$1.00, representing an appreciation of approximately
13.6% in 2009 year-to-date. The real may depreciate
or appreciate substantially in the future. See “—Risk
Factors—Risks Relating to Brazil.”
The following table provides
information on the selling exchange rate, expressed in reais
per U.S. dollar (R$/U.S.$), for the periods indicated.
The table uses the commercial selling rate prior to
March 14, 2005.
Source: Central Bank of Brazil
Brazilian law provides that, whenever there is a serious
imbalance in Brazil’s balance of payments or there are
serious reasons to foresee
a serious imbalance, temporary restrictions may be imposed on
remittances of foreign capital abroad. See “—Risk
Factors—Risks Relating to Brazil.”
Table of Contents
This excerpt taken from the PBR 20-F filed Jun 30, 2005.
Until March 14, 2005, there were two principal foreign exchange markets in Brazil, the commercial rate exchange market and the floating rate exchange market. The National Monetary Council enacted Resolution No. 3.265, dated March 4, 2005, consolidating both exchange markets in one single Foreign Exchange Market, effective as of March 14, 2005. Before this recent unification of the markets, the commercial rate exchange market and the floating rate exchange market practiced similar prices and had similar liquidity but were subject to different regulation. Most trade and financial transactions were carried out on the commercial rate exchange market, including the purchase or sale of our shares or the payment of dividends with respect to our shares to shareholders outside Brazil. Transactions not carried out on the commercial rate exchange market were generally carried out on the floating rate exchange market.
All foreign exchange transactions are now carried out in the unified foreign exchange market. Foreign currencies may only be purchased through Brazilian financial institutions authorized to operate in such market and are subject to registration with the Central Bank electronic system. Foreign exchange rates continue to be freely negotiated, but may be influenced by Central Bank intervention. The Central Bank of Brazil allows the real/U.S. dollar exchange rate to float freely, and it has intervened occasionally to control unstable movements in foreign exchange rates. We cannot predict whether the Central Bank or the Brazilian government will continue to let the real float freely or will intervene in the exchange rate market through a currency band system or otherwise.
The Real depreciated 52.3% in 2002 against the U.S. dollar, before appreciating 18.2% in 2003 and continuing to appreciate 8.1% in 2004. As of June 23, 2005, the Real has appreciated to R$2.3932 per U.S.$1.00, representing an appreciation of approximately 9.8% in 2005 year-to-date. The Real may depreciate or appreciate substantially in the future. “—Risk Factors—Risks Relating to Brazil.”
9
Table of ContentsThe following table provides information on the selling exchange rate, expressed in reais per U.S. dollar (R$/US$), for the periods indicated. The table uses the commercial selling rate prior to March 14, 2005.
Source: Central Bank of Brazil
Brazilian law provides that, whenever there is a serious imbalance in Brazil’s balance of payments or serious reasons to foresee such an imbalance, temporary restrictions on remittances from Brazil may be imposed by the Brazilian government. These types of measures may be taken by the Brazilian government in the future, including measures relating to remittances related to our preferred or common shares or ADSs. See “Risk Factors-Risks Relating to Brazil.”
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