Brazilian President Luiz Inacio Lula da Silva said he is “very worried´´ about the strength of the real.
“We´re watching the question of the exchange rate,” Lula told foreign journalists in Rio de Janeiro today. “We don’t want to devalue the real but at the same time we don´t want a very strong real because it hurts our trade.´´
The real has gained 7 percent over the past six months, the most among major Latin American economies after the Chilean peso’s 11.1 percent rise. The real fell 0.2 percent to 1.6993 at 7:50 a.m. New York time following a central bank announcement that it will raise reserve requirements.
Lula, who leaves office Dec. 31, said he respects Brazil’s free-floating currency system and that the government can’t set the value of the currency.
The U.S. is acting unilaterally to resolve its economic problems without weighing the consequences of its policies on other nations, Lula said.