Brazil will extend for at least six months its daily currency interventions to help support the real as part of its fight against above-target inflation. The currency gained.

The central bank will continue to offer $200 million each business day in currency swaps through at least Dec. 31, it said in a statement yesterday. Policy makers said they are prepared to provide additional dollars if needed. The central bank’s current program was scheduled to expire June 30.

A weaker real would further stoke inflation, which analysts forecast will hover just below the 6.5 percent ceiling of the target range this year. The real, which fell 13.2 percent last year, has rebounded in the wake of the government’s program and has become the best performer this year among the 16 most traded currencies tracked by Bloomberg. It gained 0.95 percent to 2.2038 per U.S. dollar at 10:23 a.m. local time.

“They’re trying to close one hole there and contain pressure on inflation on one side,” Pedro Tuesta, an economist at 4Cast Ltd., said by phone from Washington yesterday. “They want to keep inflation within the range.”

The currency swaps are designed to provide hedging and inject liquidity in the foreign exchange market, the central bank said in the statement. The new phase of the program, which started in August, will now last three months longer than traders expected, Tuesta said.

Best Performer

The real strengthened more than all emerging market currencies today, extending its year-to-date gain to 7.2 percent.

The currency measures were implemented last year after the U.S. Federal Reserve indicated it was preparing to taper its monetary stimulus, prompting the real to hit nearly a five-year low in August. A weaker real increases the price of imports.

President Dilma Rousseff’s government has struggled to tame inflation without damping growth as she runs for re-election in October. Policy makers last month halted key rate increases as they study the delayed impact of a yearlong tightening cycle on consumer prices and the economy.

Annual inflation in mid-June accelerated to 6.41 percent from 6.31 percent a month earlier, marking the fastest pace in a year. Economists surveyed weekly by the central bank forecast inflation will quicken to 6.46 percent by December. Policy makers target 4.5 percent inflation, plus or minus 2 percentage points.

Rate Gap

The difference between Brazil’s interest rate and borrowing costs elsewhere in the world will do more to boost the real than the currency swaps, Andre Perfeito, chief economist at Gradual Investimentos, said. Brazil’s Selic is more than twice as high as any other benchmark rate among major rate-setting nations in Latin America, according to data compiled by Bloomberg.

Central bankers on May 28 kept the Selic unchanged at 11 percent after increasing it 375 basis points over the nine previous meetings.

Latin America’s largest economy expanded 0.2 percent in the first quarter, down from a revised 0.4 percent in the last three months of 2013.