Brazil’s economic problems, in a nutshell
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It would take true Milei-like ardour to slice through Brazil’s economic troubles. These are caused by a gnarly mix of high public spending, stubborn inflation and low saving. The result is a crippling cost of capital. Some analysts put Brazil’s real interest rate, the BCB’s policy rate adjusted for next year’s expected inflation, at 9% or more. That is higher than in Russia and four times that in peaceful peers like Chile, the Philippines or South Africa.
It all starts with the public finances.
It all starts with the public finances.
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