8 ms·
What a difference a year makes. Brazil had the most overvalued currency in the world a year ago[1] according to the Big Mac Index, but today it's undervalued by
by alister 11y ago
What a difference a year makes. Brazil had the most overvalued currency in the world a year ago[1] according to the Big Mac Index, but today it's undervalued by 10.6%.
It strikes me that currency exchange rate is a very inconspicuous thing with a big effect. Unlike inflation, interest rates, or how much rent you pay--which everyone is aware of--most people don't sense changes in exchange rate, the effect of which is just as profound.
[1] http://brazilsense.com/index.php?title=Items_more_expensive_and_less_expensive_in_Brazil http://brazilsense.com/index.php?title=Items_more_expensive_....
- wernerpm 11y agoIt's interesting to see how most countries dropped last year because of the exchange rate. For a weird graph look at Venezuela, $9.08 in 2013 and $0.67 now.
- forgetsusername 11y ago>most people don't sense changes in exchange rate Perhaps if you're American. Here in Canada, people are made aware of the US/CDN exchange rate daily, and large moves (like recently) are news.
- Mikeb85 11y agoThe exchange rate is news, however I haven't really noticed any effect on my life (maybe when I travel, however the places I visit in the US are still cheaper than where I live).
- forinti 11y agoMcDonald's in Brazil targets a customer base very different from MacDonald's in other countries. In the US, McDonald's is cheap fast food; in Brazil its stores appeared first in posher shopping malls. The local alternative (xis) is a lot cheaper, so pricing probably has a lot to do with market segmentation, which would render such comparisons useless.
- dataker 11y agoBrazilian here and I can attest to this. In the U.S, I only go to McDonald's if I'm alone and don't have an option( Chipotle is closed). In Brazil, you'll see some families choosing it over local cuisine for 'modernity' or even 'sophistication'.
- thanatropism 11y agoWhat? Where? You're either talking about lower-lower middle class, or far outside the large metros, I presume? I'm amazed no one mentioned Bob's Burgers, at any rate. Are you in the same Brazil I'm in?
- ucaetano 11y agoLower-income middles class can't afford R$15 burgers with the average (not median, which is much lower) household income per capita being ~R$1000/month. In practice, less than 20% of families make that much. With combos, 10 meals would account for 20% of pre-tax income. Data is a couple years old, but still relevant: https://sacrariopessoal.files.wordpress.com/2014/10/faixascm20121.jpg https://sacrariopessoal.files.wordpress.com/2014/10/faixascm...
- polymatter 11y agoFor what its worth, in my experience its similar in China. I even saw an ad showing a guy taking his girlfriend to McDonalds on a date.
- swah 11y agoPics of 'xis' from my street: https://www.google.com.br/search?q=xis+do+gelson&num=20&rlz=1C1EVTC_pt-BRBR598BR599&espv=2&source=lnms&tbm=isch&sa=X&ved=0CAcQ_AUoAWoVChMI65qtqofgxgIVA0uQCh3Biw9h&biw=1600&bih=763 https://www.google.com.br/search?q=xis+do+gelson&num=20&rlz=...
- jvm 11y ago> Brazil had the most overvalued currency in the world a year ago[1] according to the Big Mac Index, but today it's undervalued by 10.6%. According to the adjusted index, it's still the world's most overvalued currency.