832.51/1280
The Ambassador in Brazil (Caffery) to the Secretary of State
[Received March 14.]
Sir: Referring to recent reports regarding the matter of Brazilian foreign government debts, I have the honor to report that, in my opinion, it would be unwise to press for the conclusion of a debt settlement at this time, having in mind the extremely precarious position of Brazilian foreign exchange. If the Brazilian Government were forced to make a debt settlement at this juncture, the Brazilian authorities, without question, would invite attention to their foreign exchange difficulties and offer a settlement within their present means which would unquestionably not be satisfactory to the holders of Brazilian bonds.
For well-known and obvious reasons, I am not in a position at this juncture to say when an opportune moment will be reached for pressing for a settlement:—all I can say now is that this is not the opportune time.
Respectfully yours,