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

To: Bob Howarth who wrote (12149)	1/21/1999 11:14:00 AM
From: Steve Fancy	Respond to of 22640

Interesting thought Bob. - sf <eom>

To: Bob Howarth who wrote (12149)	1/21/1999 11:23:00 AM
From: Steve Fancy	Respond to of 22640

Brazil c.bank says will not intervene in forex mkt Reuters, Thursday, January 21, 1999 at 11:10 BRASILIA, Jan 21 (Reuters) - Brazil's Central Bank reiterated Thursday morning that it will not intervene in the foreign exchange market to impede sharp fluctuations in the currency, the real. The foreign exchange rate will be set by the market in function of dollar flows, Altamir Lopes, the head of the Central Bank's economic department, said. Copyright 1999, Reuters News Service

To: Bob Howarth who wrote (12149)	1/21/1999 11:26:00 AM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

Real plunges on rumors of heavy dollar outflow São Paulo, 21 - The commercial dollar surprised the market this morning when it surpassed the limit of R$ 1.60 amid rumors, not confirmed by some dealers consulted by Agência Estado, of a heavy dollar outflow led by national oil company Petrobrás. After the Central Bank announced it allowed the real to free-float last Friday, the government started to consider the limit of R$ 1.60 as a sort of an informal real trade ceiling. This morning megainvestor George Soros declared that Brazil's interest rates, already at over 40% yearly, are much too high and that the International Monetary Fund (IMF) gave Brazil a "bad advice" when it suggested the country to increase its rates. Soros' shock wave declarations also contributed to send negative vibrations throughout the market. The news agency, Bloomberg, also cited the dwindling stock of dollars at commercial banks due to capital flight of more than US$500m a day this month as another reason for the real weakening against the dollar. At 9:42 a.m. the real was plunging 7.40% against the dollar to R$ 1.69 -- its weakest ever -- from yesterday's closing rate of R$ 1.58. (By Lucinda Pinto and Paulo R. Monteiro Dias)

To: Bob Howarth who wrote (12149)	1/21/1999 11:29:00 AM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

With outflows at at only US$208M yesterday, ahead of a big nervous vote, looks like we can thank Mr Soros and Mr Biggs for todays selloff. Barton Biggs is always wrong isn't he? Forex posts a US$208.6m deficit on Wednesday São Paulo, 21 - The Brazilian foreign exchange market posted a US$333.626m deficit (commercial plus floating dollar segments) last Wednesday. Financial inflow in the commercial dollar segment reached US$189.300m, below outflow which stood at US$386.943m. In the trade account, exports reached US$104.974m, against imports of US$115.989m. With the figures, the segment has accumulated a net deficit in the month of US$4.939bn. Yesterday, the floating dollar posted a deficit of US$125m. (By Lucinda Pinto)

To: Bob Howarth who wrote (12149)	1/21/1999 11:30:00 AM
From: Steve Fancy	Respond to of 22640

Domestic markets lower on profit-taking Market participants believe that the government's victory in Congress yesterday on the federal civil servants' social security contribution bill, as well as the São Paulo stock exchange (Bovespa) outstanding nominal gains of 51.75% -- accumulated since the Central Bank announced it had allowed the real float freely against the dollar -- will lead investors to engage in profit-taking, at least during the early hours of trading this Thursday. However, the intensity of the fall in prices remains yet to be seen, as analysts believe investors who were out of the market in the last couple of days, may want to come back. The pessimistic current though says prices may fall over 10% in the next two to three days as investors try to technically correct the price of domestic stocks. Although the government's victory late on Wednesday is undoubtedly a positive sign, investors claim it is not enough to guarantee stocks' rally which begun last Friday. For them, it is also needed to continue monitoring the government's performance in the Congress since important measures are still awaiting to be approved, as well as the forex market so as to make sure the dollar bleeding has come to a halt, or at least diminished significantly. "Now that social security contribution bill is past, the second-round voting on the CPMF - Temporary Tax on Financial Transfers (the so-called check tax) -- is again on the spotlight," a dealer told Agência Estado this morning.

To: Bob Howarth who wrote (12149)	1/21/1999 1:54:00 PM
From: Steve Fancy	Read Replies (2) \| Respond to of 22640

Brazil crisis not to boost coffee exports -Abecafe Reuters, Thursday, January 21, 1999 at 13:13 RIO DE JANEIRO, Jan 21 (Reuters) - Brazil's currency crisis will not trigger a surge in coffee exports in the short term because growers will probably wait for better prices due to an expected production shortfall, a leading exporters group said Thursday. In a statement, the Brazilian Association of Coffee Exporters (Abecafe) said output from the current 1999/2000 coffee crop, which should be harvested from May, would not be enough to satisfy either internal or external demand. And as most producers had raised enough cash from previous sales, they were unlikely to rush into quick sales now after Brazil's recent devaluation of its currency, the real, because coffee prices could be expected to rise from July, it said. "The real's devaluation should not cause an increase in coffee exports in the next months. The fall in the real should only have an effect in the long term by raising the national coffee-grower's competitivity against external competitors." "Most producers today are capitalized and are not in a hurry to sell coffee now because they are able to anticipate better prices from July as according to the forecast, the 1999/2000 crop will not be enough to meet internal and external demand for Brazilian coffee," the statement quoted Abecafe's director Roberto Sarcinelli as saying. Abecafe cited government figures released on Wednesday showing Feburary export registrations at just 762,563 60-kg bags, well below the average monthly volume of 1.8 million bags posted for the second half of 1998. March registrations totaled a mere 264,552 bags, it said. Earlier this week, Abecafe said Brazil's government would need to sell more than half of its current coffee stocks over the next 18 months to ensure stable local supply. Using last month's official estimate of 23.15 million 60-kg bags for the 1999/2000 crop, Abecafe said five million bags -- or some 277,000 bags every month -- would have to be auctioned out of the current 9.5 million held in government stocks. "Adding the 17 million (bags) of coffee remaining from the 1998/99 harvest with the 23 million expected for the next, Brazil will have a gross total of 40 million bags for the next 18 months, which is not enough to meet internal and external demand," it said. The regular auctions, held as an electronic sale by Banco do Brasil, are open to all of Brazil's coffee industry -- exporters, roasters and the soluble sector -- which compete to buy old-crop stocks stored in authorised warehouses. Copyright 1999, Reuters News Service