BRICS seek to limit fallout of U.S. stimulus withdrawal

Mon Jun 24, 2013 9:09pm EDT
 
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By Alonso Soto

BRASILIA (Reuters) - Major emerging-market nations will work together to limit the effects that a strong U.S. dollar could have on their economies as the Federal Reserve signals plans to scale back its massive stimulus program, the Brazilian government said on Monday.

Brazilian President Dilma Rousseff and her Chinese counterpart, Xi Jinping, discussed ways to strengthen policy coordination on Monday in a telephone conversation, said Thomas Traumann, spokesman for the Brazilian government.

Rousseff will contact other leaders of the BRICS group, which include Russia, India and South Africa, later this week to discuss concrete measures.

"The BRICS will decide on coordinated action related to the global appreciation of the U.S. dollar at a meeting in July in Russia," Traumann said without elaborating.

Brazil and other developing nations - until recently the main engines of the global economy - are growing anxious about the expected withdrawal of stimulus in the United States, which has sparked a sell-off in local markets.

In his conversation with Rousseff, China's Xi stressed that "new and complex" developments in the global markets called for closer coordination among the BRICS, a Brazil-based diplomat told Reuters.

"There is a consensus that the BRICS need to strengthen communication and coordination at a time when we have more complex and new factors affecting global markets," said the official, who was briefed on the presidents' discussion.

The official, who asked for anonymity, gave no specifics.   Continued...