Oil prices in Brazil are plummeting to record low levels.
The world’s second-largest economy is still reeling from a crippling economic crisis that has caused a global recession and has killed at least 1.2 million people.
In the last week, Brazil’s economy has shed more than 50% of its output, and inflation hit 6.5%.
The country has been forced to import nearly half of its food and energy, which it needs to keep the economy going.
In a desperate effort to get its economy going again, President Dilma Rousseff has been asking the Federal Reserve to print money to stave off a collapse.
The Fed has been refusing to do so, saying that printing more money would hurt the economy.
But there is a new twist.
This time, the Fed is sending its reserves in an unusual way, which will increase the value of the currency.
As the Bloomberg article notes, “The Fed’s central bank will increase its cash reserves from $85.4 billion at the end of December to $89.4bn on Jan. 1, with the aim of supporting inflation, the central bank said Thursday.
It will also increase the size of its reserves by $6.5 billion.”
The move comes as the world’s largest economy, reeling from the economic crisis, has been trying to sell off billions of dollars in assets to make up for the billions of barrels of oil it has lost in the crisis.
“The move is likely to spur an even larger run-up in oil prices, which have plunged more than 40% in the past six months, said Brian Wieser, head of global fixed income at S&P Global Platts.”
In other words, the country’s government is selling off a lot of assets to pay for the new dollars.
So what will the money buy?
Well, there is good news, because the reserves are now worth $9.9 billion.
However, as Bloomberg notes, this will only increase the countrys total reserves by about $9 billion, which means the country has less money in the bank.
For now, it will be worth about $16.4 million, a loss of almost $5 billion.
It could drop further, but if the government’s goal is to bring back economic growth, this is not likely to happen.
Still, the news is a boon to the economy, which has been suffering from a severe recession and economic stagnation.
While Brazil’s economic situation is bleak, it still has a very bright future.
According to the IMF, Brazil is one of the fastest-growing economies in the world, and it is expected to grow 2.5% this year.
With the country in dire straits, the world is watching closely to see what this means for the country.
And this is the most important economic news in a long time.