TheEconomist

President Lula said this morning in his weekly radio talk that Brazilian economy has not been hit yet by the American house-financing crisis, although there are enemies trying to make this happens for political purposes. 

Yeah, he´s right: up to now there´s nothing wrong with Brazilian markets this Morning with central banks all over agreed to put some money to calm down speculators.

Sao Paulo SE was up 2% a few moments ago and probably will follow NY tendencies today.

Exchange rate between Brazil´s real and US dollar is stable this afternoon and it is expected to flutuate around 1,9 and 2,1 in the immediate future.

One thing  people at Finance Ministry told us off the record is the clear perception of someone being actually inside the eye of the hurricane, as minister Guido Mantega said last week.

Even you can´t see it cleary, you feel it´s around - and it´s terrific such as a friend from Austin told us about images coming from Caribbean islands hit by Dean yesterday.

US Federal Reserve kept on injecting money on the American banking system, as did the Japanese monetary authority, which is helping to keep the markets calm, like it was in Europe today. 

The “thing” is the perception that there is a financial internacional crisis on the going and investors are moving  towards US bonds, leaving behind worried emergent markets.

Brazil´s risk rate is still high, compared to other countries, around 215 points at JP Morgan.

Nobody doubts Brazilian GNP will close this year around 5% - the highest in this century and the first step for Lula´s allied parties dreaming about some kind of third term without Lula (he´d rest for coming back for years later), maybe with Defense minister Nelson Jobim (PMDB) and Civil Affairs minister Dilma Roussef (PT).

It´s all still, the dreams. People sleeps with an open eye.

Real side of Brazilian economy is doing well upt to now.

And it will get better with the green revolution (ethanol and conservation of Amazon forest), paving the road for next years of not so modest GNP rates.

People who sleeps deeply usually are more optimistic and dremans Brazilian economy growing at 7% in election year of 2010.

Brazil´s midia quotes Finance Minister Guido Mantega assuring that outside finance turmoils haven´t hit Brazilian economy yet.

The quasi-crisis was trigged by France Central Bank decision on closing operations with a few American home-financing broken funds. 

“Brazil is among those very solid countries able to cope with higher or lower levels of nervous movements in the markets”, he said.

Global uncertainities must not influence next Central Bank decisions on the basic interest rates (now at 11.5% for a 12-months period). “The (foreing) markets are not worried about Brazil”, said Mantega, a University of Sao Paulo professor at the Economics School and a, let´s say, friend but not exactly a follower of former Finance Minister Pedro Malan, who estabilized the economy with the Real Plan (1994-2002). 

Brazilian economy has now strong fundamentals, he said, with foreing reserves near US$ 160 billions and “no selling pressures on Brazilian companies papers or Treasury bonds”.

President of Central Bank Henrique Meirelles (former Bank Boston´s CEO) assured that Brazilian financial markets have been operating “under absolute normality”.

Extra resistance shown by Brazilian economy towards foreing crisis is due, said Meirelles, to a set of measures and correct politics such as floating exchange rates, growing of international reserves and the domestic “monethary authority strong compomise with low inflation targets”.

“Brazil´s Central Bank will keep on monitoring, toghether with its international partners, the development of the markets”, said Meirelles.