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BRICS: Exchange Rate policy in Context of Internal and External Equilibrium
[BRICS: Kurzová politika Brazílie v kontextu vnitřní a vnější rovnováhy]

Author

Listed:
  • Jaroslava Durčáková
  • Ondřej Šíma

Abstract

The article deals with the exchange rate policy of Brazil in period 1999 - 2012. The first part informs about the global development of the system of exchange rates and shows marked differences after 2008. This global course is supported in the case of Brazil. Next part is concentrated mostly on the interaction between exchange rate policy and internal and external equilibrium. Brazilian balance of payments seems to be suitable concept to catch these events, including often mentioned impacts of the so called unconventional monetary policy on emerging markets. Besides these effects the Brazilian economy was influenced by long-term changes in the global economy. Rising prices of Brazilian exported commodities belonged to the most important one. These prices influenced the exchange rate of the real. In authors´ point of view the recent development of Brazilian economy indicates the presence of the so called Dutch disease. The disease is closely connected to excessive (real) overvaluation of the currency and increasing volatility of terms of trade. To confirm this idea of the Dutch disease it is necessary to monitor forthcoming years very carefully.

Suggested Citation

  • Jaroslava Durčáková & Ondřej Šíma, 2013. "BRICS: Exchange Rate policy in Context of Internal and External Equilibrium [BRICS: Kurzová politika Brazílie v kontextu vnitřní a vnější rovnováhy]," Český finanční a účetní časopis, Prague University of Economics and Business, vol. 2013(4), pages 7-29.
    • Handle: RePEc:prg:jnlcfu:v:2013:y:2013:i:4:id:348:p:7-29
    DOI: 10.18267/j.cfuc.348
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    More about this item

    Keywords

    Brazil; Exchange rate policy; Balance of payments; Brazílie; kurzová politika; platební bilance;
    All these keywords.

    JEL classification:

    • F31 - International Economics - - International Finance - - - Foreign Exchange

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