Last week, the federal government’s decision to breach Brazil’s federal spending cap — one of the country’s most effective austerity controls — spooked investors and led to some of the São Paulo stock exchange’s worst performances in 2021. But benchmark indexes roared back on Monday, also as a result of government action. Shares of oil giant Petrobras jumped almost 7 percent after President Jair Bolsonaro suggested its privatization was “on the government’s radar,” a statement later endorsed by Economy Minister Paulo Guedes.
Talk of handing Petrobras over to the private sector is little more than a pipe dream, rehashed...
