LAST Week, the International Monetary Fund (IMF) Moved to Provide Yet Another Bail-Out in Latin America with a $30Bn Rescue Package for Brazil

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LAST week, the International Monetary Fund (IMF) moved to provide yet another bail-out in Latin America with a $30bn rescue package for Brazil. The move followed US Treasury secretary Paul ONeills visit to Brazil in an attempt to rebuild bridges strained by US unwillingness to support IMF intervention.

Brazil has been highly exposed to deteriorating investor confidence as the presidential elections loom in October. The potential for a more leftist president with an uncertain commitment to the IMF policy programme has esculated capital flight. This has resulted in a significant increase in interest rates to support the currency and in the first quarter the Brazilian …