As of the end of 2008, Brazil held 89.1% of its reserves in US dollars, 9.4% in Euros and 1.5% in other currencies. 79.1% of reserves was invested in government debt while 12.9% was invested in multilateral debt (presumably World Bank dent, and the like).These figures were just released by the Brazilian central bank.

Reserve diversification has been a topic of conversation for the market off and on for the last two years. The big rally to 1.60 in EUR/USD was driven in large measure by diversification. Thew collapse down to 1.23 was driven in large measure by the unwinding of those diversification plat amid a deflationary, deleveraging environment.

Since global markets have settled down in 2009, it is not hard to imagine Brazil having a smaller dollar weighting today than they did at the end of last year.