Brazil’s Capital Market: Current Status and Issues for Further Development

 
Author/Editor: Park, Joonkyu
 
Publication Date: September 01, 2012
 
Electronic Access: Free Full text (PDF file size is 1,667KB).
Use the free Adobe Acrobat Reader to view this PDF file

 
Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
 
Summary: Capital market development in Brazil is a key policy issue going forward to foster savings, investment and absorptive capacity in a context of prospects for sizable capital flows in the medium term. During the last decade, Brazil has achieved substantial progress in capital market development. The menu of available financial instruments has been expanded, market infrastructure has been reformed and strengthened, and a diversified investor base has been built. Nonetheless, Brazil’s capital markets are still facing a number of challenges including prevalent short-term indexation, investors’ risk aversion to long-term fixed rate bonds, still low liquidity in the secondary market, and managing the role of BNDES. A shift to a lower yield curve environment should continue to gradually take place. But further progress will require continued policy effort to assure macro stability and financial sector reforms to promote the development of longer-term private finance.
 
Series: Working Paper No. 12/224
Subject(s): Bond markets | Capital markets | Investment | Stock markets | Brazil

Author's Keyword(s): Brazil | capital market | indexation | long-term financing | BNDES
 
English
Publication Date: September 01, 2012
Format: Paper
Stock No: WPIEA2012224 Pages: 21
Price:
US$18.00 (Academic Rate:
US$18.00 )
 
 
Please address any questions about this title to publications@imf.org