A string of countries have edged towards imposing capital controls to stop short-term speculative inflows driving their currencies higher amid concerns about the growth of an emerging market asset bubble.
Yesterday Brazil, which surprised the markets a month ago by imposing a 2 per cent tax on the inflow of money destined for financial assets, said it would further tighten those restrictions. The finance ministry imposed a new 1.5 per cent tax on the issuance of depository receipts, assets that allow Brazilian companies to offer shares on foreign exchanges.
