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

To: Steve Fancy who wrote (11759)	1/15/1999 7:29:00 AM
From: posjim	Read Replies (1) \| Respond to of 22640

think I just heard they were going to float the real on cnbc..725am.

To: Steve Fancy who wrote (11759)	1/15/1999 10:51:00 AM
From: Steve Fancy	Respond to of 22640

Brazil governor gives Cardoso new headache on debt Reuters, Friday, January 15, 1999 at 06:29 BRASILIA, Jan 15 (Reuters) - A Brazilian state controlled by a new left-wing governor has turned to the courts to challenge an existing debt renegotiation agreement with the federal government, in another headache for President Fernando Henrique Cardoso. It was the second state to take issue with the federal government over debt. Last week, Minas Gerais state governor Itamar Franco declared a 90-debt moratorium on his state's $13.4 million debt to the federal government, sparking a wave of insecurity that has dragged Brazil back into severe financial turmoil. Rio Grande de Sul Governor Olivio Dutra has opted for a less confrontational method of dealing with his $13 billion in debt with Brasilia by turning to the Federal Supreme Court (STF), Brazil's highest. The STF said in a statement issued on Thursday night that it has agreed to review the case and, in the meantime, would permit the state to deposit a payment due on Friday of 31.2 million reais in the federal mortgage bank instead of handing it over to the government directly. The STF did not say when it expected to rule on the case. Copyright 1999, Reuters News Service

To: Steve Fancy who wrote (11759)	1/15/1999 10:52:00 AM
From: Steve Fancy	Respond to of 22640

Brazil's Central Bank says scraps currency suppports Reuters, Friday, January 15, 1999 at 08:49 SAO PAULO, Jan 15 (Reuters) - Brazil's Central Bank said it scrapped support for the real, the nation's currency, allowing it to float freely in the foreign exchange markets, at least for Friday. The Central Bank said it will set new foreign exchange rules on Monday. The move follows Brazil's surprise devaluation of the real by more than 8 percent on Wednesday, setting off turbulence in world markets. "The Central Bank will not intervene in foreign exchange markets today," the bank said in a statement. "A new communique regarding the foreign exchange regime will be released on Monday." It was the first time the government allowed the real to trade freely since the currency was introduced in 1994 as the backbone of a plan to crush rampant inflation in Brazil -- the world's eighth largest economy. Brazil has suffered from a hemorrhage of dollar outflows reaching $1.0 billion a day after its third biggest state of Minas Gerais declared a suspension of its debt payments to the central government on Jan. 6. The move caused a wave of panic in world financial markets and cast into doubt Brazil's austerity drive and the fate of its IMF-led $41.5 billion international bailout package. Copyright 1999, Reuters News Service

To: Steve Fancy who wrote (11759)	1/15/1999 10:54:00 AM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

Brazil's real at 1.49/dlr vs 1.55/dlr - traders Reuters, Friday, January 15, 1999 at 09:13 SAO PAULO, Jan 15 (Reuters) - Brazil's currency firmed slightly to 1.49 reais against the dollar on Friday after tumbling as low as 1.55 reais to the dollar after the Central Bank effectively allowed the nation's currency to float freely. At 1.49 reais, the real devalued 11.4 percent compared to Thursday's close at 1.32 to the dollar. The currency's tumble began Wednesday when the Central Bank set a wider trading band, sending the real down more than 8 percent against the dollar to 1.32. Copyright 1999, Reuters News Service

To: Steve Fancy who wrote (11759)	1/15/1999 10:56:00 AM
From: Steve Fancy	Respond to of 22640

Brazil real hovers around 1.50/dlr at midday trade Reuters, Friday, January 15, 1999 at 10:29 SAO PAULO, Jan 15 (Reuters) - Brazil's real stabilized in midday trade, devaluing around 12 percent on Friday, after the Central Bank released its tight grip on the currency and let it float freely on foreign exchange markets. The real was trading at between 1.49 and 1.50 reais to the dollar, compared with Thursday's close of 1.32, and holding steady before markets paused for lunch when operations virtually cease, traders said. "The government did what it had to do and so did the market. Now it's calm and the real seems to be stabilizing," a trader at Banco Bozano, Simonsen in Rio de Janeiro said. The Central Bank lifted Friday morning the newly widened trading band that it set only two days before. The real quickly weakened as it went into a free float, plunging to 1.58 to the dollar. The bank said it will announce a new foreign exchange regime on Monday. One Central Bank official said that the bank could return to forex markets next week to defend the real. The turbulence began Wednesday when the Central Bank removed the tight, crawling band peg it had been using to control the real for the last four years. It implemented a wider maxi band set at between 1.20 and 1.32 reais to the dollar. The real quickly devalued more than 8 percent, nestling against the limit of the new trading band at 1.32 to the dollar. The Central Bank was forced to sell dollars in the market Wednesday and Thursday to defend the rate, and Friday morning finally gave up. "With everyone buying into the bolsa, the forex market has really calmed down for now," a trader at a local brokerage said. Sao Paulo's Bovespa index (INDEX:$BVSP.X) surged 18.5 percent in midday trade on optimism that the government has finally resolved its foreign exchange policy battle, which could stem dollar outflows and bring interest rates down. "That doesn't mean that we've seen the end of problems, though. The government still has to get its finances in order. We'll just have to wait and see," a trader said. shasta.darlington@reuters.com)) Copyright 1999, Reuters News Service

To: Steve Fancy who wrote (11759)	1/15/1999 10:58:00 AM
From: Steve Fancy	Respond to of 22640

Brazil move eliminates uncertainty-Mexico's Gurria Reuters, Friday, January 15, 1999 at 10:40 MEXICO CITY, Jan 16 (Reuters) - Mexican Finance Minister Jose Angel Gurria said on Friday that Brazil's decision to allow its currency to float freely had removed a key element of uncertainty affecting global financial markets. "The fact that one of the biggest countries in the world, in this case Brazil, one of the most important economies in the world, has taken this decision, represents for all of us a very important and a very positive piece of news," Gurria told Reuters in a telephone interview. MEXICO CITY, Jan 15 (Reuters) - Mexican Finance Minister Jose Angel Gurria said on Friday that Brazil's decision to allow its currency to float freely had removed a key element of uncertainty affecting global financial markets. "The fact that one of the biggest countries in the world, in this case Brazil, one of the most important economies in the world, has taken this decision, represents for all of us a very important and a very positive piece of news," Gurria told Reuters in a telephone interview. MEXICO CITY, Jan 15 (Reuters) - Mexican Finance Minister Jose Angel Gurria said on Friday that Brazil's decision to allow its currency to float freely had removed a key element of uncertainty affecting global financial markets. "The fact that one of the biggest countries in the world, in this case Brazil, one of the most important economies in the world, has taken this decision, represents for all of us a very important and a very positive piece of news," Gurria told Reuters in a telephone interview. Mexican interest rates on the secondary money market <MEX05> shot up more than 300 basis points after Brazil widened its currency trading band on Wednesday, devaluing the real by 8.2 percent. But Gurria said Mexican rates should resume their lower trend, hopefully in a matter of days rather than weeks. "Now that the situation is clearer, I expect that interest rates will resume their downward trend," he said. He said there was no reason to expect exaggeratedly high rates as happened when the peso came under pressure late last year. "Objectively there would be no reason for that," Gurria said. "The news today was very simple to the degree that Brazil has made clear it will have a more flexible exchange system." He reiterated that Mexico's economic targets would not alter due to the Brazilian crisis, with growth still forecast at 3.0 percent, inflation at 13 percent and a declining current account deficit for 1999, he said. And foreign direct investment would still be drawn to Mexico based on its healthy outlook, he said. mexicocity.newsroom@reuters.com)) Copyright 1999, Reuters News Service

To: Steve Fancy who wrote (11759)	1/15/1999 11:03:00 AM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

REPEAT:Brazil Telecom Auction To Proceed With Little Hoopla By STEPHEN WISNEFSKI Dow Jones Newswires SAO PAULO -- Just six months ago, a wildly successful auction of Brazilian telecommunications assets caught the world's attention. Now, another major local telecom auction is set to take place and few seem to notice. While news that Brazil had effectively allowed its currency to depreciate 8.2% sent shockwaves through the international financial community, preparations continued for Friday's scheduled auction of licenses to establish companies that will compete with units of former holding Telecomunicacoes Brasileiras SA, known as Telebras (TBR). The concessions will establish competition in Brazil's telecommunications sector for the first time. The Brazilian government will grant concessions for a long-distance service provider to go up against Embratel Participacoes SA (EMT), owned by MCI Worldcom (WCOM), and another to compete with locally controlled regional wireline company Tele Norte Leste Participacoes SA (TNL). Thursday, the national telecommunications regulatory group Anatel confirmed that Bonari Holding Ltda., representing Sprint Corp (FON), and Canbra Telefonica SA, on behalf of Bell Canada (BCICF), had been pre-qualified to participate. In what was seen as a major disappointment for the government, only three companies submitted proposals to participate in the auction on the Dec. 11 deadline. At the time, officials said they had expected at least six bidders. No proposals were submitted to compete against Telesp Participacoes SA, the wireline unit purchased by Spain's Telefonica SA (E.TEF) serving Brazil's most populous and wealthiest state of Sao Paulo. The mirror concession to compete against Tele Centro Sul Participacoes SA (TCS), which serves the prosperous southern states of the country and was acquired in July by Telecom Italia SpA (I.TIL), also failed to attract bidders. "There's only one proposal for each company, so if the auction goes ahead Friday, there won't be any surprises," said Sergio Missima, an analyst at Banco Fator in Sao Paulo. While the slim turnout is a letdown, particularly after Telebras attracted a who's-who of the world's telecom heavyweights and fetched a whopping $19 billion, analysts said local markets are looking for any positive piece of news after a week of turmoil, and this has the potential to be one. "A successful auction would be good for the market, particularly if it brings in foreign money," Missima said. "If it fails though, it could be yet another show of waning confidence in Brazil." The government, for its part, predicted the auction would go off without a hitch. "It will be an important day, but without any shocks," national development bank (BNDES) president Jose Pio Borges said Thursday, the Estado news agency reported. Anatel set no minimum prices for the so-called mirror companies, "in order to guarantee a wider coverage and a better quality of the services." Only 30% of each proposal is based on price, while 70% is based on the technical portion. The BNDES has said it will help finance investments by companies that acquire the new concessions, paying up 60% of the cost of locally manufactured equipment. The winners are expected to be announced at 1200 GMT at the Rio de Janeiro Stock Exchange. -By Stephen Wisnefski; (55-11) 813-1988; swisnefski@ap.org -Mara Lemos contributed to this story