LONDON | Is there in these recent Brazil’s data a lesson for those in the Old Continent whose only talk is internal devaluation via salary cuts to regain competitiveness, while keeping the common currency too high for irrational fear of the inflation ghost?
March brought a negative surprise with consumer credit non-performance rates in Brazil, which ticked up to 7.6% after having fallen to 7.4% in February. But that shouldn’t be a reason to worry, analysts at Barclays Capital pointed out:
“…with real wage bill growth gaining momentum in April, we believe it is just a matter of time before non-performance rates start moving down decisively. This means that credit conditions should start to get better and support a faster activity recovery in the second half of 2012.”