Foreigners unwind $11.4B BRL short in two days, largest reversal since 2020

Foreign investors cut their net short position in Brazilian real derivatives by $11.4 billion over two days, the sharpest such reversal in years, per B3 data. The move suggests a rapid shift in sentiment toward the BRL, possibly driven by policy signals or external flows, though the trigger is not specified. This unwinding could reduce near-term depreciation pressure on the real and signal a turning point for Brazil's currency market.