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Brazil Growth Curbed by Inflation as BlackRock Stays Bullish

Brazil is being held back by a strengthening currency, the fastest inflation in six years and an increase in government spending, damping growth prospects in the world’s second-largest developing economy.

The country risks becoming a “prisoner of its own hype” as it faces the twin dilemmas of a currency that’s strengthened 47 percent versus the dollar since the end of 2008 and consumer price increases above the central bank’s target, Christopher Sabatini, senior policy director for the Council of the Americas, said today at the Bloomberg Brazil Conference. Brazil has “hit the limit” of sustainable growth, said Augusto de la Torre, chief economist for Latin America at the World Bank.