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Strategies & Market Trends : Telebras (TBH) & Brazil -- Ignore unavailable to you. Want to Upgrade?

To: Steve Fancy who wrote (8860)	10/6/1998 10:00:00 AM
From: Steve Fancy	Respond to of 22640

Brazil forex markets lost net $336 mln on Monday Reuters, Tuesday, October 06, 1998 at 09:02 SAO PAULO, Oct 6 (Reuters) - Brazilian foreign exchange markets lost a net $336 million on Monday in a sign dollar flight from Latin America's largest economy persists, though at a moderate pace, dealers said. The net dollar drainage -- $206 million from the commercial forex market and $130 million from the floating market -- was down from a total $680 million that left on Friday. Heavy dollar outflows have been reported from Brazilian forex markets since August when Russia defaulted on its foreign debt, frightening emerging market investors around the world. About $29 billion has fled the country's forex markets since the beginning of August, draining Brazil's foreign currency reserves to about $48 billion. Forex dealers expected outflows would continue as long as investors remained uncertain over the country's economic outlook. Copyright 1998, Reuters News Service

To: Steve Fancy who wrote (8860)	10/6/1998 10:01:00 AM
From: Steve Fancy	Read Replies (3) \| Respond to of 22640

Brazil plans 25 bln reais 1999 budget cut - papers Reuters, Tuesday, October 06, 1998 at 09:17 RIO DE JANEIRO, Oct 6 (Reuters) - Brazil's economic team, working feverishly to contain a soaring public deficit during a period of international investor unease, plans 25 billion reais in budget cuts in 1999, local newspapers reported Tuesday. "The budget adjustment will be dramatic, definitive and permanent," Demosthenes Madureira de Pinho Neto, the Central Bank's director of foreign operations, was quoted as saying in Rio de Janeiro newspaper Jornal do Brasil. Pinho Neto was part of the economic team negotiating a precautionary funding agreement with the International Monetary Fund (IMF) to help Brazil weather global financial turmoil. Other newspapers quoted Pinho Neto and Central Bank governor Gustavo Franco in Washington as saying spending cuts in 1999 would be around 25 billion reais ($21 billion). Franco stressed that the new economic program would not involve a devaluation or an acceleration of Brazil's crawling-peg exchange rate policy that has been gradually easing the local currency, the real, against the U.S. dollar. The IMF's chief economist Michael Mussa said on Sunday that it was "conceivable" Brazil could speed up the rate of depreciation against the dollar to one percent a month from 3/4 of a percent at present. But Franco firmly denied the suggestion, telling investors and analysts that it was "not conceivable". "In no circumstances do we conceive of a change in the exchange rate regime," he said. Pinho Neto said the budget adjustment would be about 3 percent of gross domestic product (GDP). Franco said there would be a ceiling put on state spending and if the states surpassed it, taxes normally distributed to them would be retained and used to cover the difference. Brazil's fiscal deficit is almost 8 percent of GDP and economists say the government needs to save about $20 billion next year to bring it into line and restore confidence. tracey.ober@reuters.com)) Copyright 1998, Reuters News Service