World does not notice that Brazil is mired in

The world does not notice that Brazil is mired in economic problems

The country is on
the verge of economic collapse, and the situation every day gets worse. analysts at Morgan
Stanley noted that Brazil now!
under pressure of three
factors: the credit crunch developing
markets, problems in China and change
US monetary policy. experts
of Goldman Sachs recently said in general that
in Brazil there is a real
stagflationary nightmare.

The second quarter was
terrible for Brazil – growth
the economy fell sharply accelerated
inflation. In addition, the fiscal deficit
He became the most powerful in the country in May of
last 11.5 years – he has reached a level
GDP, 7.9%. In addition, the country’s president
Dilma Rousseff is now absolutely
It is popular with residents –
her actions approve only 8% of Brazilians.
By the way, this Sunday is planned
a nationwide protest.

Global investors
fear that political instability
Brazil will tighten in the strongest economic
downturn. The Brazilian real depreciated by
8.1% in July, and it was the biggest decline
among the 16 major currencies, for which
watching Bloomberg.

With all these
events, China’s participation in the global currency
wars – the last thing that was needed
Brazil. According to the Minister of Trade
Brazil Armando Monteiro, a decision
China to devalue the yuan will harm
export of manufacturing products
industry of the country. The course of the Brazilian
Real Madrid will fall – Goldman Sachs
predict a fall
rate to 4 reais per US dollar for
of the year. Now the rate is 3.55 reais
per dollar.

In Brazil, no
so many ways to solve problems
and all of them – not the most pleasant. First
option – political backdrop is deteriorating,
This leads to loss of control and
institutional crisis (including
departure of key politicians), and then to
deterioration of investor confidence. but this
variant will hit the dying
economy. The second option – is
potential stabilization of the political
picture of the country that will provide the authorities
opportunity to implement the necessary
monetary policy.

In any case, the real
will continue to depreciate, because
that without it is impossible to return to a more
balanced results. Wherein
the first path may eventually lead
to stabilize the economy, because
the destruction of the foundations of an opportunity for
a good rebound. The second scenario is more
soft, but he also encouraged political
forces.

Against the background of escalating
currency wars Brazilian economy
actually it entered in absolute mode
free fall. If nothing
It changes, the country will soon receive
"trash" status.

Related posts

Next posts

Leave a Reply

Your email address will not be published. Required fields are marked *