“The new intervention program announced by the BCB Thursday sees the central bank offering $500 million of dollar swaps in the currency derivatives market on a daily basis for the rest of 2013, and $1 billion of FX spot lines on Fridays.  Essentially, the BCB is taking a big short position in the U.S. dollar. The BCB is conducting the majority of the real-bolstering intervention in the derivatives market as opposed to the spot market because under the latter scenario, the central bank has to burn through the U.S. dollar component of its foreign reserves in order to prop up the currency, whereas with swaps, foreign reserves don’t come into play.”

http://www.businessinsider.com/the-bcbs-new-fx-intervention-program-2013-8

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