Brazil’s President Rousseff pins Obama about US monetary policy

“We don’t have this problem with China”
Daylife/AP Photo used by permission

Brazilian President Dilma Rousseff complained about U.S. monetary policy and failed to make major progress on trade in a White House meeting with President Barack Obama on Monday, highlighting strains between the Western Hemisphere’s two biggest economies.

Rousseff said that while expansionary monetary policies in wealthy nations were needed to keep global economic problems from becoming worse, she worried about the unintended consequences for developing countries such as Brazil.

Brazilian officials have blamed low interest rates and bond-buying programs in Europe and the United States for causing a “monetary tsunami” that has caused liquidity to flow into Brazil, pushing up the value of its currency and making its exports less competitive.

Expansionist monetary policies … ultimately lead to a depreciation in the value of the currencies of developed countries, thus impairing growth outlooks in emerging countries,” Rousseff said.

Speaking at a press briefing shortly afterward, White House spokesman Jay Carney declined to comment on how Obama responded…

U.S. business leaders are eager for greater access to Brazil, which surpassed Britain last year to become the world’s sixth biggest economy and has seen about 30 million people join the middle class in the past decade…

But talks over greater trade integration have yielded little progress. A joint statement released by Rousseff and Obama after their meeting said they had “further emphasized the importance of the mutual benefits of stimulating increased trade and investment,” but mentioned no major advances.

Golly gee. I thought it was exclusively up to the White House and Congress to determine which nations were currency manipulators.

Could this be chickens coming home to roost?

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