Source: Xinhua
05-05-2009 16:56
Special Report: Global Financial CrisisRIO DE JANEIRO, April 4 (Xinhua) -- Brazil's Finance Minister said on Monday that the situation of the global economy and financial system is undergoing a slight improvement in the second quarter of 2009.
Guido Mantega said, the international markets are becoming more stable, though it does not mean the problems caused by the international financial crisis have been overcome.
The Brazilian economy is registering improvement as well, he said.
"What we have been observing is that in the second quarter of this year the Brazilian economy is recovering from the impact of the end of last year," the minister said, adding that recovery is already influencing on the credit levels, which have "improved a little."
Mantega said the Brazilian economy has reacted positively to the government's incentives in March and April, especially the automotive and construction sectors, benefiting from cuts in the tax over Industrialized Products (IPI).
In the meanwhile, Mantega reaffirmed that the government will not extend the tax cut to other sectors.
The minister said Brazil's annual basic interest rate Selic must fall further so that the country could reach the desired credit levels.
Brazil's Monetary Policy Committee (Copom) announced a one percentage point cut in the Selic rate last week, from 11.25 to 10.25 percent.
With the cut, Brazil no longer has the highest real interest rate in the world.
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Editor:Xiong Qu
