In mid-December 2024, Brazil's currency, the real, fell 2.8% to an all-time low against the US dollar, marking a significant devaluation over the year. The decline raised alarms regarding rising inflation and increased costs for imports. Economists attribute this weakening to concerns over Brazil's structural fiscal problems and the effectiveness of the current government's policies. The national minimum wage has diminished significantly, and national debt is forecasted to reach historically high levels. Calls for government spending cuts are underscored amidst rising GDP-to-debt ratios.
In the days before the meltdown, Brazil's central bank had repeatedly intervened in local currency markets to stem the slide but largely failed to stop the bleeding.
The gradual devaluation of the real over the entire year of 2024 is the result of global investors growing increasingly concerned about the Brazilian economy's structural problems.
Rodrigues told DW. The economist from Universidade Federal Fluminense (UFF) university thinks the increase in debt is alarming and must be curbed by cutting government spending.
Now, the GDP-debt ratio is approaching historical highs as we've reached almost 78%.
Collection
[
|
...
]