Good morning! Today, we discuss how Lula continues to scare off investors. The Federal Police act on the biggest corporate scandal in Brazilian history. And a challenge to a Braskem deal in Maceió is tossed out.
☕ If you like our work and want to give us an extra boost, you can fill up our reporters’ coffee mugs. Supporters get exclusive perks! Find out more.
Lula interview deepens currency crash
An interview with President Luiz Inácio Lula da Silva, published on Wednesday on the news website Uol, heightened market jitters in Brazil. The president questioned the need to curb public spending and stated he wouldn’t support a move to unpeg social benefits from the minimum wage, contradicting members of his economic team.
👉 Why it matters. Markets took Lula’s words as a sign that the government has neither a plan nor commitment to meet its zero-deficit fiscal targets this year and stop the public debt from ballooning.
- Already performing poorly after officials from the U.S. Federal Reserve talked down the chance of interest rate cuts in the U.S. this year, the Brazilian real crashed even further — reaching its lowest point against the dollar since January 2022.
Unfazed. Lula said...