MercoPress. South Atlantic News Agency
IMF praises Brazil’s “carefully calibrated” policies and forecasts 7.1% growth
BNDES ‘soft’ credits have surged in first half on 2010 The International Monetary Fund reiterated its forecast for Brazil’s economy to expand 7.1% this year, as result of capital inflows and the expansion of credit. However the IMF also cautioned about the official credit policy of the country’s development bank.
The IMF, in a statement following a July visit to review Latin America’s largest economy, said “carefully calibrated” policy mix was needed to preserve macroeconomic and financial stability amid surging economic growth that has put a strain on resources and infrastructure.
Directors recommended that authorities continue with efforts to curtail quasi-fiscal spending in the form of loans provided by the National Development Bank.
The Rio de Janeiro-based BNDES lent 137.4 billion Reais (78 billion USD) last year, more than double the 64.9 billion lent in 2007. Lending jumped 41% to 46 billion Reais during the first five months of this year compared with the same period a year ago.
BNDES key interest rate for loans, known as TJLP, is 6%, or 475 basis points below the central bank’s 10.75% benchmark lending rate.
IMF directors also encouraged further steps to reduce both gross and net debt as percentages of gross domestic product.
Last July IMF raised its 2010 growth outlook for Brazil from the 5.5% forecast in its May regional outlook on Latin America. The IMF expects inflation to end 2010 at 5.8%.
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Read all comments“BNDES key interest rate for loans, known as TJLP, is 6%, or 475 basis points below the central bank’s 10.75% benchmark lending rate.”
Aug 06th, 2010 - 01:12 am 0Brazil Central Bank's interest rate are abusively high. It promotes inflow of speculative capital and thwarts loans taken by industries. That the government keeps funding BNDES, is only natural in face of CB's policies. The operation autonomy conceded to the CB has not worked, something one can conclude by looking at the way the CB reacted to the 2008 crisis: correctly but belatedly. I wish the next president will have the balls to demolish CB's autonomy. If he or she faces resistence in so doing, then fire OR KILL current CB's president Henrique Meirelles and replace him by someone humbler and more sober-minded.
i hope brazil one day pay the moral debt they have with argentina since brazil with argentina´s logistical & decisive support secure mato groso in the triple alliance war; the most important beligerant effort in brazil history.
Aug 06th, 2010 - 04:36 am 0(2) Billy Hayes
Aug 06th, 2010 - 04:45 am 0That is THE most stupid thing I have read in here!
Your “personal” share of that “moral debt” should be one biiiiiiig patada on the culo!
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