Banco Central Do Brasil has provided BRL346 billion through the program so far, including BRL209 billion through lower reserve requirements and BRL2.2 billion through looser regulations, according to a presentation at an event hosted by the Brazilian-American Chamber of Commerce. Loans backed by credit guarantees total BRL50.5 billion but could reach BRL670 billion, according to the presentation, while a new term deposit with special guarantee program accounts for BRL18.6 billion but could inject BRL200 billion into the financial system.
More flexibility in credit renegotiations could add another BRL3.2 trillion from BRL881 billion currently. New measures listed in the presentation include asset purchases in the secondary market and real estate-backed loans, which could add a BRL60 billion. The Central Bank’s liquidity supports represents 17.5% of the Brazil’s GDP, compared to 3.1% in Mexico, while loan support represents 20% of GDP, compared to 18.3% in Argentina and 3.9% in Mexico, according to two graphs in the presentation. Monetary policy is another tool being used by the Central Bank to spur economic activity. In August, the monetary policy committee, known as Copom, cut the benchmark Selic interest rate to its lowest ever level of 2% to help stimulate the economy.