Latin American Financial Crises and Recovery. Jan Kregel , Senior Scholar, Levy Economics Institute of Bard College and Distinguished Professor, Center for Full Employment and Price Stability, University of Missouri, Kansas City Remarks Prepared for the Conference:
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Senior Scholar, Levy Economics Institute of Bard College and Distinguished Professor, Center for Full Employment and Price Stability, University of Missouri, Kansas City
Remarks Prepared for the Conference:
A Decade After: Recovery and Adjustment since the East Asian Crisis,
Organised by International Development Economics Associates (IDEAs), Good Governance for Social Development and the Environment Institute (GSEI), Action Aid and Focus on the Global South
July 12-14, 2007, Bangkok Thailand
Against a CA deficit over $30 billion in 1997 and 1998 and no signs of improvement in fiscal or external balance, after re-election exchange rate abandoned in January of 1999.
The Real surpassed 2 Reis to the US dollar and then stabilized.
Against conventional expectations
inflation pass-though was moderate
Arminio Fraga introduced a policy of guiding interest rates downward, while the government persisted in its policy of running primary surpluses.
The result was a short-term spurt in growth in 2000 that was quickly reversed by the contractionary policies at the end of the Cardoso administration and the speculation surrounding the incoming Lula administration.