SAO PAULO, Aug 24: Brazil’s Central Bank sold $200 million in export credits on Friday, handing its ailing export sector much-needed relief as officials prepared to lobby the world’s banks to look favorably upon the country.

The sales helped prop up Brazil’s currency, the real which fell to an all-time low last month as companies unable to renew their loans abroad scraped for US dollars to pay off their debts.

Friday’s sales were the first of $2 billion in financing the Central Bank intends to auction to help offset the credit crunch. Demand was so strong for the first $100 million sold that the Central Bank announced it would sell another $100 million in the afternoon. It too met strong demand.

But analysts said the exporters would need more help than that.

Central Bank President Arminio Fraga and Finance Minister Pedro Malan are scheduled to fly to New York this weekend to meet with global bankers on Monday. They are expected to lobby banks to keep their credit lines to Brazil open.

You can’t think it is just about one measure, said Sergio Machado, head of the treasury department at Banco Fator.

The improvement (in the currency market) has more to do with expectations that Arminio’s and Malan’s trip will be a success.

Analysts from Fitch Ratings said on a recent conference call that in the last six months, overall trade-related credit lines fell by about $3 billion to $13 billion. In addition to the scarcity of cash, the terms of such credits have been shortened to between 30 days to three months, in some cases, which severely crimps companies’ export capabilities.

Brazil’s real has shed a quarter of its value so far this year as investors fret over the wide advantage held by two left-leaning candidates, Luiz Inacio Lula da Silva and Ciro Gomes, in the polls.

Wall Street worries a left-leaning president might bungle economic policy and push Brazil toward a default on its $250 billion net public debt.

The resulting investor panic helped prompt the International Monetary Fund to throw Brazil a $30 billion financial lifeline earlier this month.

Investors largely prefer Jose Serra, viewed as the politician most likely to extend President Fernando Henrique Cardoso’s record of financial austerity and market-friendly reforms. Serra, however, continues mired in a distant third place in polls.

—Reuters