The Brazilian government is considering intervention measures to curb the appreciation of the real, according to a report by MercoPress citing Finance Minister Guido Mantega.
“We are worried by the real appreciation,” said the Minister “The government has taken action in the spot market, and we could also take measures in the derivatives market, and the futures market.
“The problem is that monetary policy in advanced economies is too relaxed,” Minister Mantega added. “These countries are not recovering. They have a problem of growth. That’s why money flows to emerging countries.”
The real has gained 49 per cent against the US dollar since the end of 2008 – the best performer among 25 emerging market currencies tracked by Bloomberg.
On Monday 4 July, the real appreciated to its highest level since 1999 as expectations that Greece may resolve its debt crisis increased demand for higher-yielding assets, the report said.
Within the fresh produce industry, the strong real is making Brazil less competitive on the global market, which is encouraging suppliers to sell to the domestic market where consumer demand is rising.
