Attention Economy


Tuesday, October 26, 2010

Brazil Gets Tough on (Short-Term) Foreign Portfolio Inflows

“Lula raised the tax on foreigners’ fixed-income purchases to 6 percent on Oct. 18 after a doubling of the rate to 4 percent on Oct. 4 failed to stem the real’s advance. The currency has surged 32 percent in the past two years as Brazil’s interest rates, the second highest in the world in inflation- adjusted terms after Croatia, lured foreign investors”.