Brazil raises interest rates to plug dollar outflows
Reuters, Thursday, September 10, 1998 at 22:15
SAO PAULO, Sept 10 (Reuters) - Brazil on Thursday
raisedinterest rates to nearly 50 percent in a bid to plug
massive dollar outflows from its financial markets, the Central
Bank said.
The Central Bank hiked its basic assistance rate Tban to an
annual 49.75 percent from 29.75 percent, a bank spokesperson
told Reuters.
The move came after Brazil's foreign exchange markets saw a
huge drain of dollars, estimated at over $2 billion, on
Thursday, after losing more than $8 billion in the first 10
days of September.
Stock prices also plummeted on Thursday as panicked
investors, worried about the massive capital flight, pulled out
of the market.
The Sao Paulo stock exchange's key Bovespa share index
plunged nearly 16 percent, its biggest one-day drop since
October 1987.
Copyright 1998, Reuters News Service |
