Brazil Brazil Brazil

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After the final numbers of inflation are reported at the end of the year for each country, most people start to discuss about the positive and negative effects of the possible current inflation or deflation in order to plan ahead for the new year, and start working on the areas that a country could benefit from in order to strengthen the economy and ideally maintain a healthy presidential administration. Particularly, the article of the Wall Street Journal "Brazil 2013 Inflation Rises Above Target" written by Jeff Fick and Rogerio Jelmayer with the contribution of Gerald Jeffris discusses two main correlated issues the country of Brazil is currently facing, an unexpected rise in inflation and the alternatives the Brazilian government along with president Rouseff are contemplating to alleviate the problem in order to seek reelection in the upcoming presidential election in October.
Since 1999 the central bank of Brazil introduced the economic policy of projecting inflation rates and manipulating monetary tools such as the interest rate with the purpose of pushing inflation to a more desirable and beneficial number to the country's economy. However, the country has not been successful at carrying out this task in the last couple of years despite the efforts of President Dilma Rousseff’s government of trying to stem inflation by holding down some regulated prices as policy makers contribute to the effort by boosting interest rates (Biller). More importantly, data provided by the Brazilian Institute of Geography and Statistics (IBGE) not only proved government officials expecting some kind of deceleration in inflation wrong, but also discouraged the central bank from its attempts to control the situation after a report showed a ris...

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...if one takes into account the multiple riots and protests that have been going on in Brazil against the rise in fares, corruption, and inequality, the hosting of an expensive World cup in June, and the intense and negative remarks presidential opponents will make to criticize the current administration and destroy Rouseff's lead thanks to this recent rise in consumer prices. Therefore, Rouseff's cabinet needs to look into this inflation problem more deeply and analyze very carefully what she is planning to do, not just to seek for re-election, but to solve one of the major problems Brazil needs to take care of in order to prevent future bigger and hazardous problems such as a worsening poverty crisis and more potential riots that could explode while many people tourists and foreigners come to Brazil to enjoy all of the scheduled matches the World cup has organized.

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