Brazil’s Financial Position as U.S. Edges toward Default

With the U.S. teetering at the precipice of default, countries around the world are struggling to understand how they might be affected. Brazil’s current economic situation is a mixed batch: on the one hand, it is stable and flush with reserves (about US$350 billion); on the other hand, investors looking to diversify out of the dollar may be lured to the Brazilian markets because of the country’s high interest rates, putting further pressure on the much sought Brazilian Real. While undoubtedly a downer for the manufacturing sector, a...

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