Brasilia, November 20, 2002 (Agencia Brasil ABr) - The coordinator of the goverment-elect's transition team, Antonio Palocci, says that his personnel share the International Monetary Fund mission's concern with inflation. But he added the team is optimistic regarding a drop in the exchange rate that has occurred over the last few days. Palocci blamed the recent inflation spike mainly on the dollar, saying that if the dollar falls, inflation should also come down.

As for an increase in basic interest rates, Palocci said the matter must be studied very carefully. He was referring to the meeting of the Central Bank's Monetary Policy Committee (Copom) which takes place today.

Palocci said the new government was aware of next year's budgetary restrictions, but also knows that it is going to govern Brazil for 4 years, "not 4 days or 4 months." (AB)