The international effort to forestall economic collapse in Brazil has had wobbles from its outset last October. But last Wednesday's sharp devaluation of the real was more than a wobble.
The shocks have eased, following Brazil's decision later in the week to float its currency. The real dipped further, but stabilized. Sighs of relief were heard worldwide from those who worried the country might exhaust its foreign-exhange reserves defending the currency - which had, in fact, been sharply overvalued.
One aim of the $41.5 billion International Monetary Fund plan backed by the United States was a gradual decrease in the real's value - in tandem with a shrinking national deficit. Theoretically, as this dynamic took hold sky-high interest rates - geared to slow the exodus of foreign investment - would ratchet down and economic activity could pick up.
That positive scenario still has credibility despite the devaluation. Most important, the needed belt-tightening undertaken by President Fernando Henrique Cardoso has had some success. A reluctant national legislature has approved some business tax hikes important to the plan. The government estimates 70 percent of its fiscal program has been passed.
It's an uphill task for Mr. Cardoso. The largest sources of red ink are government salaries and pensions. Cuts in that area, at a time of recession and high unemployment, spark protest.
Brazil needs time to see its reforms through. The currency shift, for all its suddenness, bought it some. International investors should move their fingers further from the panic button. Doomsayers are too quick to invoke Mexico's financial plunge, Russia's default, Asia's disaster.
The facts are far from all bad: Brazil has shown a noteworthy degree of fiscal discipline; the IMF plan's resources are still at hand to bolster the economy; reforms at work in Asia and elsewhere are slowly restoring stability globally.
The international cooperation which rallied to Brazil's aid must regain its footing and push on.