IMF welcomes Brazil commitment to reform plan
Reuters, Wednesday, January 13, 1999 at 19:13
WASHINGTON, Jan 13 (Reuters) - The International Monetary
Fund will assess the implications of Brazil's new foreign
exchange rate policy in the coming days and welcomes the
government's commitment to fiscal adjustment, Managing Director
Michel Camdessus said on Wednesday.
"In view of the crucial importance of achieving a prompt
stabilization in Brazil's foreign exchange and financial
markets, I...believe that no effort should be spared to ensure
the rapid implementation of the government's fiscal adjustment,
structural reform and privatization program, together with the
pursuit of an appropriately strong monetary policy stance," he
said in a statement.
"The Brazilian authorities have...reaffirmed to the IMF
their strong determination to put in place, with the
cooperation of the Congress and in the shortest possible time,
the full fiscal adjustment program announced in November 1998,"
he added, noting that the IMF welcomed these assurances.
"We will be analyzing and discussing with the authorities
in the coming days the implications of the new developments for
the various components of the economic policy framework
endorsed by the executive board."
Brazil won a $41 billion rescue package from the IMF last
November, the fifth in a series of multi-billion dollar
bailouts. Brazil promised to rein in its budget deficit to win
the money, but Congress has not yet approved all the measures
outlined in the IMF deal.
Brazil, bowing to market pressure, widened the band under
which its real currency can trade against the dollar on
Wednesday and the currency promptly dropped some 9 percent.
washington.economic.newsroom@reuters.com))
Copyright 1999, Reuters News Service
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