Real (as in Brazil FX) Not Acting Real With Coffee

We noted in an earlier post that coffee arabica was one of the few financial instruments that rose significantly last week (up 11.81%) amid a sea of declining asset values around the world. Much in the way Americans are hoarding toilet paper, hand sanitizers and soap out of supply concerns because of the COVID-19 virus, coffee roasters are apparently doing the same with coffee arabica out of supply chain concerns.

So, with the huge rise in coffee arabica, you would expect to see an improvement in the currencies of the two largest coffee arabica producing countries. But that didn't happen last week.

The Brazilian real fell 4.8% while the Colombian peso lost 3.6% in value. Many emerging market currencies have been hard hit by the global financial markets sell offs as investors seek the safe haven of the U.S. dollar. But, as we note on Excalibur Pro (www.excaliburpro.net), the real and peso often do have a strong correlation with coffee arabica. The two currencies did move slightly higher toward the end of last week. Perhaps a delayed reaction greets the markets Monday morning...