U.S. fiscal stimulus package could impact interest rates in Brazil

Brazilian market analysts fear that a very strong fiscal stimulus could spur U.S. inflation.

RIO DE JANEIRO, BRAZIL - With a new fiscal stimulus package about to be approved by the U.S., the risk of premature withdrawal of monetary stimulus in the United States is growing among financial market operators and analysts, which may also lead Brazil's Central Bank to standardize its interest rate policy sooner than expected.

The argument gained greater visibility after former U.S. Treasury Secretary Larry Summers and former chief economist of the International Monetary Fund (IMF) Olivier Blanchard said that President Biden's fiscal package is too broad and could lend a stronger boost to inflation.

The risk . . .

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