PARIS: Brazil's currency devaluation earlier this year, and its difficulties since in stabilizing the real as well as its stock market, have demonstrated the importance, if any new proof was needed, of financial markets and their volatile mood swings. There can no longer be any doubt that investor panic can provoke economic meltdown, as it did in Asia and Russia last year, still threatens to do in Brazil and across Latin America, and may yet stage an encore in Asia over worries about a devaluation in China and the spiral of competitive devaluations that could follow.
PARIS: Brazil's currency devaluation earlier this year, and its difficulties since in stabilizing the real as well as its stock market, have demonstrated the importance, if any new proof was needed, of financial markets and their volatile mood swings. There can no longer be any doubt that investor panic can provoke economic meltdown, as it did in Asia and Russia last year, still threatens to do in Brazil and across Latin America, and may yet stage an encore in Asia over worries about a devaluation in China and the spiral of competitive devaluations that could follow.