Brazil

[winston]

Brazil’s Futures Yields Jump to 14-Month High on Inflation By Camila Fontana

May 3 (Bloomberg) -- Yields on Brazil’s interest-rate futures contracts jumped to the highest level in 14 months as faster-than-forecast inflation boosted expectations for benchmark rate increases.

The yield on the contract due January 2011, the most active in Sao Paulo trading, climbed eight basis points, or 0.08 percentage point, to 11.2 percent at 4:03 p.m. New York time, its highest level since Feb. 25, 2009. The real rose 0.6 percent to 1.7293 per dollar, from 1.7394 on April 30. The currency gained 2.4 percent last month.

Consumer prices advanced 0.76 percent in the month ending April 30, matching the previous month’s advance, according to a report published today by the Getulio Vargas Foundation in Rio de Janeiro. Economists in a Bloomberg survey forecast a 0.74 percent increase.

“We were expecting inflation to slow down in April after the seasonal adjustments of the first quarter,” said Andre Perfeito, an economist at Gradual Investimentos, with 2.5 billion reais ($1.45 billion) in assets under management. “But inflation remains under pressure, and the central bank is signaling it will raise rates more than we imagined initially,” he said in a telephone interview from Sao Paulo.

The central bank lifted the Selic rate for the first time since 2008 from a record low of 8.75 percent to 9.5 percent on April 28 to cool the economy and stem price increases.

Economists raised their forecast for this year’s inflation for the 15th consecutive week to 5.42 percent in a central bank survey of about 100 economists published today. The estimate for 2010 economic growth was boosted to 6.06 percent.

Brazil’s real pared gains after the central bank said it would buy dollars in the spot market for a second time today. The central bank bought dollars today for 1.7343 and 1.7307 reais.

http://www.bloomberg.com/apps/news?pid= ... KOu.hcwQbw

[winston]

Zell Bullish on Brazil's Real Estate By: Dan Weil

Brazil is the place to be as far as real estate investment goes, says billionaire property investor Sam Zell.

And he’s got his money where his mouth is. His investment firm Equity International has more than half its capital in Brazil.

“It’s the U.S. in the 1950s. It has a growing population, it’s energy self-sufficient, it’s food self-sufficient," Zell told CNBC.

“It’s growing and, at least for now, they’ve solved the problem of inflation. They’ve got a disciplined government that’s socially aggressive and fiscally conservative.”

Zell is impressed that debt totals only about 8 percent of gross domestic product in Brazil, compared to 60 percent in the United States.

And October’s presidential election shouldn’t upset the apple cart, as both major candidates have pledged to follow the policies of current president Luiz Inácio Lula da Silva.

“If that continues to be the case, I would think that Brazil is likely to be the number one or number two country in the world for growth over the next five to 10 years,” Zell said.

Equity International’s investments are focused on the growth of Brazil’s middle class, with millions of people being lifted from poverty there.

A recent International Monetary Fund report lauded Brazil for its quick recovery from the financial crisis.

"This remarkable performance has been underpinned by the authorities' robust policy framework, based on fiscal responsibility, exchange rate flexibility, and a credible inflation target," the report said.

http://www.moneynews.com/StreetTalk/bra ... /id/368112

[LenaHuat]

Brazil's GDP will grow faster than China's for the first time soon (cannot recall where I read this). She has just conducted a reverse privatization of Petrobras whereby the state now controls slightly more than 50% of the oil company.

[winston]

Why are u buying brazilian Equities when rates are at 10.75% ? Do you know what you are buying ?

Brazil Holds Rate at 10.75% as Bank Awaits More Information on Inflation
By Matthew Bristow and Andre Soliani

Brazil’s central bank kept its benchmark overnight rate unchanged today as policy makers gauge whether an uptick in inflation is temporary.

The policy committee, led by bank President Henrique Meirelles, left the rate at 10.75 percent for a second straight meeting, matching the forecast of all 51 analysts surveyed by Bloomberg. The decision was unanimous.

The central bank will modify its current stance when there’s clear evidence that consumer prices are rising at a level that threatens its 2011 inflation target, said Luciano Rostagno, chief strategist at CM Capital Markets Ltd.

Policy makers forecast that slower global growth will bring inflation down to 4.6 percent next year without further rate increases, according to a Sept. 30 report from the bank.

“The bank expected food to push inflation higher, and that’s essentially what’s happening,” Rostagno said, speaking by phone from Sao Paulo. “They’ll change the policy only if they see permanent pressure on inflation.”

A report today showed that October’s mid-month inflation rate doubled from September, led by the second-biggest jump in food prices in 27 months. Prices as measured by the IPCA-15 index rose 0.62 percent, driven largely by a 1.7 percent rise in food costs, taking the annual inflation rate to 5.03 percent.

The bank targets inflation of 4.5 percent plus or minus two percentage points.

Bank Statement

“Assessing the macro-economic outlook and inflation perspectives, the Copom decided, unanimously, to maintain the Selic rate at 10.75 percent a year, without a bias,” policy makers said today in a statement accompanying their decision.

Analysts predict the central bank will raise the Selic rate to 11.25 percent in April, and then to 11.75 percent in June, according to the median forecast of about 100 economists in an Oct. 15 central bank survey.

Earlier Increases

Policy makers held the benchmark rate at 10.75 percent at their Aug. 31-Sept. 1 meeting, after raising it 200 basis points this year from a record low 8.75 percent.

The central bank estimates the world’s eighth-biggest economy will grow 7.3 percent this year. Retail sales rose a faster-than-forecast 2 percent in August from a month earlier, fueled by credit growth and record-low unemployment.

The real gained 0.3 percent to 1.6775 per dollar today, boosting its gain since the end of 2008 to 38 percent, the second-best performance among the 18 most-traded currencies tracked by Bloomberg worldwide after Australia’s dollar.

Record-low interest rates in the U.S., coupled with signs of additional easing by the Federal Reserve, helped push Brazil’s currency to 1.6442 per dollar on Oct. 14, its strongest since September 2008.

While helping to restrain inflation, the real’s surge against the dollar also threatens to dent growth as the country’s goods become less competitive in overseas markets.

In a bid to protect Brazil’s exports from what he called a global “currency war,” Finance Minister Guido Mantega on Oct. 18 raised taxes on foreign inflows for the second time this month.

Bond, Stock Inflows

In the first eight months of 2010, Brazil attracted a net $34.6 billion into its bond and stock markets, more than double last year’s total and the most since the central bank began collecting the data in 1995.


http://www.bloomberg.com/news/2010-10-2 ... dence.html

[LenaHuat]

I thought Argentines speak Portuguese and Brazilians speak Spanish.

But the truth is : Brazilians speak Portuguese. There goes my plan to learn Spanish.

[kennynah]

and i thot brazilians speak brazilian....hahahaha....there goes my plan to learn brazilian

[LenaHuat]

Hi K
SIA will fly to SaoPalo next March, not Brasilia (the capital) nor RioDeJaneiro. Do U know why ha?

[LenaHuat]

Brazil elects her first female President, Dilma Rousseff Wow, she's extraordinary .
Fr Reuters:

Rousseff's road to the presidency of the world's eighth-biggest economy was hardly traditional.

The daughter of a well-to-do Bulgarian immigrant, Rousseff joined a leftist guerrilla group during the 1960s and resisted the military dictatorship of that era. She was then jailed for three years and repeatedly tortured with electric shocks.

Upon her release from prison in 1973, she moderated her views and studied economics. She ascended through a range of mid-level government posts in southern Brazil and never showed much political ambition until Lula made her his energy minister, his chief of staff, and then his chosen successor.

[winston]

I say upside of 140% and downside of 28% then .

Go ahead, pick your number...

Brazil Stocks May Rally 70% Through 2011 on Interest Rates, JPMorgan Says
By Michael Patterson

Brazilian stocks may rally as much as 70 percent by the end of next year as low interest rates worldwide and attractive valuations lure investors, JPMorgan Chase & Co. said.

The nation’s benchmark Bovespa Index may climb to 122,000 next year in JPMorgan’s “positive” scenario that assumes “risk-free” interest rates remain low, New York-based strategist Ben Laidler wrote in a research report today. The Bovespa may fall 14 percent in JPMorgan’s “cautious” scenario that assumes earnings decline, Laidler wrote.

The MSCI EM Latin America Local Index of regional shares has “upside” of 53 percent through 2011 and potential “downside” of 14 percent, Laidler wrote.


http://www.bloomberg.com/news/2010-11-1 ... -says.html

[winston]

Not vested

Time for America to Wake Up to Brazil
December 16, 2010

When it comes to the BRICs, Brazil is sometimes an afterthought. China and India are burgeoning global powerhouses with more than 1 billion people each. Russia is a former military superpower looking to transition into an economic one.

Somewhere in the middle lies Brazil. It’s the largest country in South America, both in terms of size and population, with just over 200 million people. The country is poised to overtake France and Britain as the world’s fifth-largest economy and will play host to both the 2014 soccer World Cup and the 2016 Summer Olympics.

If you’ve been around a while, you probably know Brazil’s been here before. Perhaps no other country has held so much potential without either rising to the top or falling flat on its face.

But this time it may be different.

As you can see from this great profile that 60 Minutes did this past weekend, Brazil not only has the right natural resources to make it a key player in a globalized world, it also has the right leaders in place to create government policies beneficial to economic growth.

Key stats on Brazil from 60 Minutes:
Brazil is the largest iron ore producer in the world.
Brazil’s economy is growing three times faster than the U.S.
Eighty percent of the country’s electricity comes from hydropower.
Brazil is the world’s leading exporter of beef, chicken, orange juice, sugar, coffee and tobacco.
Brazilian-based Embraer is the world’s third-largest aircraft manufacturer.


http://www.usfunds.com/investor-resourc ... lk/?i=4597