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

To: Steve Fancy who wrote (11825)	1/15/1999 12:57:00 PM
From: Steve Fancy	Respond to of 22640

INTERVIEW-Rivlin says U.S. worried about Brazil Reuters, Friday, January 15, 1999 at 12:47 WASHINGTON, Jan 15 (Reuters) - Federal Reserve Vicechair Alice Rivlin said on Friday the United States was watching developments in Brazil with great concern but indicated the Fed saw no need to react immediately by changing interest rates. In an interview with Reuters Television, she also said the U.S. stock market was "extremely strong" but noted that a market crash was not inevitable as prices could instead decline gradually amid expectations of an economic slowdown in the United States. "I think at the moment we're all waiting for events to shake out a bit, which is perhaps fortunate for the Federal Reserve because we don't have to do anything about monetary policy until early February," she said, referring to the Fed's next scheduled monetary policy meeting on Feb. 2 and 3. Rivlin said the Fed was "not at all sure" how events in Brazil, which on Friday floated its real currency amid mounting pressure on its ailing economy, would affect the still-robust U.S. economy. "The United States is watching with a good deal of concern. The hope that there will not be another round of deterioration in Latin America is very, very strong," she said. Rivlin added that while the continued resilience in the domestic economy had taken most forecasters by surprise, she still expected the U.S. economy to slow down "in the next few months". While she declined to specify whether the risk of a slowdown was outweighed that of overheating, she noted the Fed was "looking at risks on both sides". Rivlin said the "extremely strong" U.S. stock market had so far largely ignored expectations of a slowdown in the economy and in corporate earnings, but added that a market crash was not inevitable. "It's possible that the market, as earnings come down, will come down gradually," she said. Copyright 1999, Reuters News Service

To: Steve Fancy who wrote (11825)	1/15/1999 1:01:00 PM
From: Steve Fancy	Respond to of 22640

Fed's Ferguson says Latam adds to uncertainties Reuters, Friday, January 15, 1999 at 12:47 WASHINGTON, Jan 15 (Reuters) - Federal Reserve Board Governor Roger Ferguson said on Friday the risk of Latin America's financial crisis spreading further had added an element of greater uncertainty into the economic outlook. In remarks prepared for delivery in East Hanover, N.J Ferguson said recent events in Brazil had only reemphasized the issue. "The downturns in some of the troubled economies of Asia seem to be bottoming out, at least outside of Japan, but the risk of spreading distress in Latin America creates another element of international uncertainty," Ferguson said. "Recent events in Brazil have made this concern more evident," he added. He said the Federal Reserve, which cut interest rates three times last year, would continue to monitor international developments closely. "It is now even more important that Brazil move as quickly as possible to implement a clearly sustainable fiscal position and regain the confidence of international markets and investors," Ferguson said. Turning to the high level of U.S. equity markets, he said he believed it was impossible for the U.S. central bank to target a specific level in markets in setting its monetary policy. "While it would be incorrect to say that policymakers target the equity markets or that market concerns 'tie the hands' of the Fed, the markets are an important consideration in macroeconomic analysis," he said. The Federal Reserve released the text of the speech despite bad weather preventing Ferguson from making the address at the Hanover Chamber of Commerce. washington.economic.newsroom@reuters.com)) Copyright 1999, Reuters News Service