Brazil's Problems May Be Just Beginning

Brazil's Problems May Be Just Beginning

It’s a financial lesson in being careful what you wish for. Brazil’s finance minister Guido Mantega declared the existence of a “currency war” in 2010, as wealthy countries used stimulus money to lower interest rates and escape the global recession, sending yield-seeking investors to emerging markets like Brazil. These capital flows pushed up the Brazilian rial, making the country’s export-driven economy less competitive.

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