How the weakening of the global economy could be a threat to Brazil

The opening of the markets this Friday pretty much sums up the sentiment of the week. There were some positive news here and there, better-than-expected company balance sheets, changes in the UK that brought some cheer.

The background, however, remains the same: inflation is at its highest level in almost half a century in the most advanced countries in the world and central banks are forced to raise interest rates strongly to try to fight the rise in prices.

The novelty now is that there is a conversation in the market that economies can go into recession with the rise in interest rates, before inflation is brought under control. They are reflections of a global economy going through a period of almost two decades of inflation at 2% to a new era of inflation hovering at 5%, most likely. And, consequently, it was of lower growth.

Countries that swim against the tide and do not raise interest rates, such as Japan and Turkey, face distortions in their economies.

In Brazil, a strong dollar is not good for emerging markets, just as the scenario of the world’s main economies slowing down is not good. And neither Lula nor Bolsonaro talk about how to prepare for this scenario. This Friday’s CNN Money analyzes how this scenario is a threat to the Brazilian economy.

Presented by Thais Herédia and Priscila Yazbek, CNN Money presents a balance of news issues that influence markets, finances and the direction of society and power dynamics in Brazil and worldwide.

*Posted by Ligia Tuon

Source: CNN Brasil

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