Seeking growth without inflation

Brazil looks set to meet fiscal targets agreed with the IMF and also seems to have inflation under control. But fiscal discipline has rested on increasing revenues rather than cutting expenditure, a course that will eventually restrain rather than promote growth. Reform of the tax and welfare system has barely been tackled and doubts persist about whether the government has enough political clout to see it through. A key gain is that the real economy is moving out of stagnation and into growth. Jonathan Wheatley reports