Forex Blog: Currency Trading News & Analysis.

February 14th 2005

Brazil’s Central Bank tries to curb inflation

Brazil’s once-battered economy is finally showing strong signs of economic growth. The central bank and ministry of finance intend to keep it this way, by controlling inflation and reining in government spending. The Central Bank has pursued an aggressive policy of tight money, in order to prevent the rate of inflation from returning to the double digit levels it breached as recently as 2 years ago. If the central bank follows through on plans to raise interest rates, Brazil could witness the appreciation of its currency, as investors from other countries flock to Brazil in search of higher returns. Some analysts, however, are worried that the central bank may be acting too agressively in its rate hikes. The Economist reports:

[The central bank’s] friends worry not that it is misguided, but that it may now become over-zealous… [Some analysts believe] the central bank should accept a bit more inflation this year—say 5½-6%—rather than aiming to hit the target precisely.

Read More: Brazil’s central bank: Risks, new and old

SocialTwist Tell-a-Friend
Posted by Adam Kritzer | in Exotic Currencies | No Comments »

Sponsored Offers

FREE Daily Email Updates

Enter your email address:

Delivered by FeedBurner

Have Questions? Want to Share Your Review?

Be heard. Please share your reviews today!

Neighboring Posts

© 2004 - 2023 Forex Currency charts © their sources. While we aim to analyze and try to forceast the forex markets, none of what we publish should be taken as personalized investment advice. Forex exchange rates depend on many factors like monetary policy, currency inflation, and geo-political risks that may not be forseen. Forex trading & investing involves a significant risk of loss.