WELCOME :: MAIN MENU MOVED TO THE BOTTOM OF THE BLOG!

Search the Web

Wednesday, January 12, 2011

Brazil, Fearing Currency War, Takes Harder Edge Vs. China

Will Brazilian equities get their mojo back under new President Dilma Rousseff, who's battling a strengthening currency?
Brazil's Bovespa exchange rose just 1% in 2010 while many New York-listed stocks like energy giant Petro bras (PBR) dived, even as Brazil's hot economy jumped an estimated 7.4%. The Bovespa surged 83% in 2009, leading the way out of the global financial crisis.
With China a big buyer of Brazilian iron ore, meat, soy beans and sugar, some pundits say the Bovespa may not come roaring back until China's stocks rebound.
China's exchange shed 14% last year. Beijing is tightening monetary policy, which will cool its economy.
Rousseff, meanwhile, is aiming to take a tougher line in trade talks with China amid global currency tensions. Brazil's currency, the real, is up more than 100% against the U.S. dollar since 2003. Brazil's trade, however, has been shifting from the U.S. to China.