The three-figure increase follows a 46 percent decline in 2002, the Wall Street Journal reported Wednesday.

Yields for Brazil's government bonds soared to more than 25 percentage points above comparable U.S. Treasurys and the dollar surged 75 percent against Brazil's currency, dropping the real to an all-time low against the dollar.

To discourage an even wider selloff in the bond market, the central bank was forced to raise interest rates above 26 percent, a crippling move for an economy struggling to recover.

But following President Luiz Inacio Lula da Silva's election win last October, it became increasingly clear the new president would not allow a debt default or pursue an antibusiness agenda.

By year end, the stock market had shot up 50 percent from its October low. With bond yields falling back to five percentage points above U.S. Treasurys, the stock market rally has continued into 2003.