Matthew Bristow – Bloomberg, 10/10/2012
The Brazilian real is well-placed to resist the latest round of U.S. monetary stimulus due to “lines of defense” erected by the government, Finance Minister Guido Mantega said.
The currency won’t strengthen as much in response to the U.S. Federal Reserve’s third round of quantitative easing, or QE3, as it did during the first two rounds, due to a tax on financial transactions known as the IOF, and the country’s record-low interest rates, Mantega said.
“Gradually, there will be an entry of dollars,” Mantega said in an interview in Tokyo, where he is attending a meeting of the International Monetary Fund. “I don’t think that a lot will enter, because the Brazilian economy is protected, defended, with measures such as the IOF.”