Banks, Domestic debt intermediation and confidence crises: the recent brazilian experience

Afonso S. Bevilaqua () and Marcio Garcia

Brazilian Journal of Political Economy, 2002, vol. 22, issue 4, 651-669

Abstract: This paper examines the recent evolution of the Brazilian public domestic debt and interprets it in light of the confidence crisis literature. The analysis of the recent developments in the Brazilian public domestic debt market shows that the likelihood of a default must not be assessed only using simple summary aggregate measures of public domestic debt size and maturity, but must also consider other structural aspects. Our analysis emphasizes the two main pillars of the Brazilian public domestic debt market: home-bias and the role of the banking sector in intermediating the debt. Evidence from yields of a “perfectly” indexed bond shows that the rollover premium was very small when the devaluation occurred, and is still fairly small by October, 1999, indicating that the rollover of the public domestic debt is not, so far, a serious problem. Positive prospects for the public domestic debt market will depend, however, on the Brazilian government maintaining the current fiscal austerity program. JEL Classification: F32; F34; G21.

Keywords: Banks; Public Debt; Currency Crises; Brazilian Economy (search for similar items in EconPapers)
Date: 2002
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://centrodeeconomiapolitica.org.br/repojs/ind ... rticle/view/957/2166 (application/pdf)

Related works:
Working Paper: Banks, domestic debt intermediation and confidence crises: the recent Brazilian experience (1999)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ekm:repojs:v:22:y:2002:i:4:p:651-669:id:957

Access Statistics for this article

More articles in Brazilian Journal of Political Economy from Center of Political Economy
Bibliographic data for series maintained by Brazilian Journal of Political Economy (Brazil) ().