Brazil Central Bank betting on a US Slowdown

Brad Setser's blog claims that Brazil's and other cenral banks are betting on a US slowdown in the next quarter.

First, Brazil’s reserves increased by a bit less than $5b in August. Second, Brazilian central bank/ banks reduced their short-term claims on the US by $2.7b or so. So even Brazil's central bank accounted for all the fall in short-term claims, it would have only been able to generate $7.5b or so of $11b in purchases .... Yet even if Brazil's central bank didn’t do all the buying, it rather clearly invested a decent chunk of growing reserves in Treasuries and shifted a significant sum from short-term investments to longer-term investments.

That is the sort of thing you do if you think US rates are about to fall. In other words, it was the sort of bet that makes sense if you think Mr. Recession in 2007 is going to be at least ½ right, and not just about the third quarter.

Question: What would be the effects on India, in case it turns out to be true?

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