Good morning! Bolsonaro wants to mark his administration’s 200-day anniversary with a monetary stimulus package for the Brazilian economy. The House goes on holiday, but lawmakers will be quite busy when they return. And the government’s ambitious privatization plan. Enjoy your read.
Bolsonaro tries to find a pulse in the Brazilian economy
The Brazilian government is set to announce a stimulus package aimed at injecting quick money into the economy. The move would coincide with the milestone of the administration’s first 200 days. Allowing workers to withdraw from their severance fund (BRL 40bn) and releasing money from a workers’ social contribution fund (BRL 21bn) could amount to a capital injection exceeding BRL 60bn.
Why it matters. The Brazilian economy has struggled mightily to leave recession mode. After Q1 2019, GDP shrank 0.2%—and there is no strong reason to believe that Q2 results will be very different. Albeit a quick fix, putting money into the hands of families could help citizens cut down their debts and start consuming more. The retail sector, for instance, has posted negative results over the past two months. In a country where household consumption is such an important factor...