MercoPress. South Atlantic News Agency

Rousseff blasts US and China’s currencies’ “competitive depreciation” policies

Brazilian president Rousseff demands ‘more responsibility’ from developed countries

Emerging market countries such as Brazil and Argentina must take a stronger position against “competitive depreciations,” Brazilian President Dilma Rousseff told Argentine press on Sunday.

Rousseff, who this Monday was in Buenos Aires for her first foreign visit since taking office a month ago said multilateral bodies should tackle currency issues and developed countries, must “assume their responsibility.”

The Brazilian Real currency has gained more than a third against the dollar in just over two years, and Finance minister Guido Mantega has blamed the rally on the developed world, slamming the United States for keeping interest rates low and the dollar weak through its quantitative easing policy.

“It's well known that Brazil and Argentina suffer, that all emerging market countries suffer, as a result of the depreciation policy practiced by the countries in question,” Rousseff said when asked about the role of the United States and of China.

“Our position in the G20 needs to be one of increasing reaction against these depreciations, which always lead to difficult situations in the world. I'm talking about the so-called competitive depreciations,” she added.

Brazil is Argentina's biggest export market, and surging demand from its neighbour for cars and other manufactured goods has stoked Argentine growth.

Argentine business leaders fear a weaker Brazilian currency could erode the competitiveness of their exports, but Rousseff said it was impossible to rule out the Real future depreciation.

”No one in the world can promise that (the Brazilian currency won't depreciate),“ Rousseff said in the interview. ”But we have managed of late to keep the dollar within a floating range of between 1.6 and 1.7 Real per dollar.”