Brazil-Risk among the lowest
Valor Econômico
Brazil was in the spotlight among the emerging countries in the international market of credit in the period after the break of Lehman Brothers and was consolidated as the country of lowest risk among the most negotiated countries. The Brazil-risk is 19.6% below what it was before the most acute stage of the crisis, on September 15, compared to the 12.9% increase on the average of the 14 countries of the CDX index.
"Irrespective of all the problems and challenges, Brazil is seen as the most disciplined and foreseeable country", says Octavio de Barros, director of the Department of Economics of Bradesco.
As he sees it, the Brazil-risk tends to keep declining, closing at levels of 100 basis points in the end of this year, compared to the 124.915 basis points on the Friday for the premium of the credit default swap (CDS) of the Brazilian foreign debt with maturity in five years.
"The relative performance of the Brazil risk was excellent during the crisis, overcoming that of the other emerging countries, which we already expected", says Daniel Tenengauzer, general-manager and head of global strategy for rates and currencies of Bank of America Merrill Lynch. "What is amazing is that the Brazil risk is now even lower than the Mexico spread", affirms the strategist.
"Brazil was one of the first countries to get out the recession and the perspectives for growth for next year are even more encouraging, due to the cycle of investments in the areas of oil and gas", says Octavio de Barros, who foresees growth of 2.1% in the Gross Domestic Product in the second quarter of 2009 in comparison with the first one. In the third quarter, there will be stability and in the fourth, new growth of 2%, he foresees.