Goldman Sachs says Brazil’ Real needs to decline 20% to remain competitive

Tuesday, March 13th 2012 - 07:03 UTC

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Jim O'Neill, chairman of Goldman Sachs Asset Management, lent his support to Brazilian policy makers' efforts to weaken the Real, saying it needs to decline 20% to keep Latin America's biggest economy competitive. Read full article

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Ozgood
We seem to be in an era of competitive devaluation. I cannot see why “debauching” their currency would help. What it will do is to feed an inflationary pulse into the system, Exports will become competitve for a while but there will be more upward pressure on domestic prices.

Brazil has had its share of hyperinflation.

Yuppie traders will take one way bets on the direction of the currency and make a killing by shorting it.
Mar 13th, 2012 - 12:48 pm - Link - Report abuse 0
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