The aim was to prevent consumption pressures that might compromise the success of the real. These measures initially included a reserve requirement on demand, time and savings deposits, with a view to preventing uncontrolled growth in the supply of credit. New measures along the same lines were adopted throughout the second half of 1994, always aiming at controlling demand without bringing on a recession. The continued growth of consumption in the early months of 1995 led the Government to take further measures to restrain it in february and March. In the fiscal area, the sudden drop in inflation brought about a noticeable relief for the Government's fiscal balance.
Tax revenue continues to show a good performance.
The public sector borrowing requirement, which measures the public deficit in terms of government borrowing on the financial market, also improved substantially in 1994 in comparison with the three preceding years. The primary definition disregards interest paid on the domestic and external debt when calculating the fiscal outturn and considers revenue on an accrual basis, posting it when due even if has not been received into the Treasury's cash account. The Real Plan cleared the way for stabilization, but stabilization cannot be guaranteed without the changes proposed in the constitutional reform process now under way in the National Congress. The Government met the legally mandated monetary targets for the last two quarters of 1994. As a natural consequence of the monetization of the economy, the pressure of the demand for money was very strong during the first three months of life of the real.