A note on inflation targeting and economic growth in Brazil

This paper analyzes the relation between monetary policy and economic performance in Brazil during the period 1999-2006. In particular, it discusses the growth effects of the inflation targeting regime through its effects on aggregate demand. It is argued that monetary policy under IT reacts in a procyclical and asymmetric way to fluctuations in economic activity (too "tight" during recessions, not so "loose" during expansions). Such pattern may generate a downward bias in aggregate demand, with negative real effects on output growth and employment. Our results suggest that monetary policy has been procyclical and asymmetrical in Brazil under inflation targeting. The main economic policy implication of this study is that central banks should consider more seriously the real effects of monetary policy on output and employment.

Tariff discrimination on Brazil's soluble coffee: an economic analysis

This article evaluates the impacts of the imposition of tariffs on the Brazilian soluble coffee mainly by European countries as of the 1990s. More particularly, it verifies whether the imposition of discriminatory trade tariffs by the European Union and of non-discriminatory ones by some Eastern European countries reflects on the international demand for this commodity. For this purpose, dynamic models of global demand for Brazilian soluble coffee were estimated for the 1995-2003 period using data from the International Coffee Organization. Findings suggest that existing tariffs significantly account for the reduction of Brazilian share of soluble in the world market.