Brasília – Brazil’s minister of Finance, Guido Mantega, spoke to the head of the International Monetary Fund (IMF), Cristine Lagarde, about exchange rates in emerging nations. He said that Brazil will continue intervening to reduce the appreciation of its currency. In Washington, where he is to participate in annual meetings at the IMF and the World Bank, the minister recalled that Brazilian industry has been losing competitiveness due to the appreciation of the real, supposedly caused by the lack of activity by financial authority of other countries.
"In the case of Brazil, we are one of the countries suffering most with depreciation of the currency. Our industry has been losing competitiveness partly due to the depreciation of the currencies of other countries,” said Mantega. "We are proving, in practice, that with regular interventions in exchange rates – as other countries have decided to use this strategy – we may reduce the disadvantage our industry has been feeling due to appreciated exchange rates,” he added.
Mantega’s declaration was in response to a statement by IMF director general Christine Lagarde, who had said that emerging nations need to make adjustments or accept stronger currencies. “Europe is not the only place where it is necessary to act. Emerging markets also need to deal with their problems. Other emerging markets need to pay attention to capital flows and manage them with the necessary tools of macroeconomic prudence, adjusting their currencies in an appropriate way and accepting the appreciation of these currencies,” said Lagarde.
*Translated by Mark Ament
