br Data and methodology br Invoice currencies in the Brazili

Data and methodology
Invoice currencies in the Brazilian foreign trade As mentioned in Section 1, Brazilian exporters were forbidden to receive their payment in domestic currency until 2007, the year our data series begins. From 2007 to 2011, we see that the Brazilian exports’ distribution by invoice currency is highly concentrated. Eleven currencies were used to invoice, having the USD been used to invoice approximately 95% of the total exported amount. All currencies used to invoice exports are international currencies, except the domestic BRL. Besides the USD, the remaining amount is invoiced mainly in euro (EUR) and residually in the other nine currencies, including the BRL. Table 1\'s left columns (exports) shows a summary of these data. Unlike Brazilian export invoicing, the invoice of imports does not occur exclusively in international currencies or BRL. Although the international currencies’ share is at 99.98% of imports, other noninternational national currencies are also identified in addition to the BRL. The remaining 0.02% (about USD 220 million) is distributed among a large set of currencies. Brazilian importers accept different currencies to invoice minor operations. During the analyzed period, the number of currencies in this set increased slightly from 32 (in 2007) to 36 (in 2011). The right side of Table 1 (imports) consolidates the data on international currencies and the BRL share. Fig. 1 explicits the BRL-invoicing ninefold growth in the five-year enough in exports and the fourfold growth in imports. Fig. 2 displays the variation of the BRL and the EUR against the USD from 2007 to 2011, normalized for the first day. During this period, the BRL pursued an appreciation trend against the USD, strongly reversed during the international financial crisis worsening. The EUR followed a similar trend during the early period on a smaller scale. After the crisis worsened, EUR appreciation weakened, and the gap between the two currencies’ rates suggests some impact over the analysis of the nominal Brazilian trade data recorded in USD. While the USD share in export invoicing remained stable during the series plotted in Table 1, the BRL share significantly increased with the decrease of the EUR and other currencies’ share. This confirms our curiosity about the BRL increase phenomenon. The BRL was used as invoice currency in operations in 24 different countries in 2007; in 2011, the number of countries of destination increased to 96 countries.
Trade-in-BRL outlook The following subsections deal with the BRL usage. After establishing in the last section that the BRL is used in trade, here we observe that the BRL usage has grown in Section 5.1. In Section 5.2, we report that this growth was remarkably significant when looking into Brazilian trade with Argentina and we suggest that the bilateral payment system implemented by the national governments has driven the invoice choice. In Section 5.3, we remark that the main exports in BRL are homogenous products and, in Section 5.4, we test if the choice on invoice currency matches with the currency chosen to make the payments.
Final remarks
Acknowledgements This paper is part of a broader research agenda aiming to understand the international status of monies and the role of the Brazilian real on the international stage. I am greatly indebted to Maurício Barata de Paula Pinto for his constant support and criticism. I also thank Cédric Tille for his valuable comments during my visiting period at the Graduate Institute of International and Development Studies International Economics Department. This paper has also benefited from the comments provided by Jorge Saba Arbache Filho, Renato Coelho Baumann das Neves, Maria Sokolova, seminar participants and anonymous reviewers. The visiting period was granted by the Capes Foundation (BEX 3818/14-4). This research was conducted under the Banco Central do Brasil\'s PPG program (Pt 1101539860) at Universidade de Brasília. A previous version of this paper was circulated as Invoice Currency in Brazil.