The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.
Awards

Central bank governor of the year 1998: Gustavo Franco's bold use of power

Brazil long needed a heavyweight in the central bank chair and now it's got one. Gustavo Franco earned his spurs in last October's Asian meltdown. His policy regime, especially the use of capital controls, is being studied around the world. Brian Caplen reports.

Highly commended: Luis Angel Rojo, Central banker, Spain

Highly commended: Gyorgy Suranyi, Central banker, Hungary


Brazil's textbook response to last October's Asian crisis turned central bank governor Gustavo Franco into a figure of world renown. The doubling of interest rates together with fiscal cuts kept Brazil stable and gave credence to the current policy regime - fixed exchange rate with crawling devaluation and capital controls in an otherwise market-oriented environment - that Franco is associated with.

The Russian crisis is putting Brazil to the test again and the final outcome remains uncertain. While no-one is invincible, Brazilians can rest assured that in the current turmoil they have an experienced technician at the helm, who is cool in a crisis and not afraid to use the full weight of his powers to see off trouble.

"Gustavo Franco advised the president at the time of the Asian crisis that the government had to go for a very orthodox response," says an analyst with a Brazilian investment bank. "This earned him huge respect in the markets."

But Franco's resolute stance has not always made him popular.


You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree