Comment by katamarimambo

Real never really gained value this way, the government defined the value of the bands. It floated up and down inside the bands, but the government was acting behind the scenes to keep the bands (essentialy a peg), mostly burning reserves, selling companies and cutting programs. It helped controlling inflation and was a good approach even in hindsight, the duration of the measure is the problem. In 1997 it was clear to everyone that the peg was not sustainable and should be removed, but the government postergated until past the (re)-elections. But that's Brazil, and then there's Argentina...