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Brazilian government rules out response to possible US recession

Business Materials 16 January 2008 23:27 (UTC +04:00)

( dpa )- Brazil is not planning any measures to combat the effects of a possible US recession and credit crunch on the local economy, Brazilian Finance Minister Guido Mantega and Central Bank President Henrique Meirelles said Wednesday.

Meirelles said Brazil is "monitoring very carefully" the development of the crisis in international financial markets and the falling dollar, but there is currently no need for "specific measures" to avoid the effect of the problems on the Brazilian economy.

"The Brazilian market has liquidity. The market for the real (the Brazilian currency) has not faced the problems other countries have had with their local currencies. Therefore, we do not see the need for punctual measures in this field," Meirelles said.

Mantega said he did not believe there is a recession in the United States, but stressed that Brazilian President Luiz Inacio Lula da Silva has instructed his government to follow the crisis closely, and if necessary to adopt measures to protect the 10th-largest economy in the world.

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