MercoPress. South Atlantic News Agency
Brazilian central bank opposes using the country's US$ 370bn reserves
Tombini warned then that the bank was ready to use reserves to tame a surge in volatility at the time. 
Speculation that Brazil could sell dollars from its reserves on the spot market peaked last month when the Real hit an all-time low of more than 4 per dollar. Brazil's central bank chief, Alexandre Tombini, told lawmakers he opposes using the country's $370 billion foreign reserves at this moment as they serve as an insurance policy for Latin America's largest economy.
Tombini warned then that the bank was ready to use reserves to tame a surge in volatility at the time.
Speculation that Brazil could sell dollars from its reserves on the spot currency market peaked last month when the Brazilian real hit an all-time low of more than 4 per dollar.
Some economists say Brazil has excess foreign reserves that could be sold to reduce its public debt at a time when the government struggles to gap a budget deficit.
Speaking with lawmakers during a breakfast in the central bank's headquarters, Tombini said he does not support the idea of using foreign reserves to pay debt.
“I would not touch the reserves in this context,” he said, according to a recording of the meeting. He argued that local companies have not had any difficulty finding external financing “despite the international turbulence and all the uncertainty regarding Brazil's economy.”
Top Comments
Disclaimer & comment rules-
-
Read all commentsTrombony has actually said something sensible for a change!
Nov 02nd, 2015 - 06:47 pm 0Why throw good money (U$D) after crap (the Real)?
The real answer is to have new elections, cut the bollocks off the unions, drop the ridiculous interest rate which shackles business expansion and confiscate ALL Lula's money, he's a crook.
That, together with the austerity measures implemented in full would make a start.
It will never happen though!
Brazil looks fucked to me.
FHC, Brazil's president from 1995 to 2002, said in an interview last week, that the way the crisis was developing, the best solution for the country would be for Dilma to step down after coming to an agreement with Congress to push the through the legislation necessary for Brazil to have a chance at recovery. Knowing Dilma and the PT, this will not happen, as they would prefer to see Brazil drown in shit before giving up power....
Nov 03rd, 2015 - 05:38 pm 0Commenting for this story is now closed.
If you have a Facebook account, become a fan and comment on our Facebook Page!