The presentation of the tax rule that will replace the spending cap seems to have revived the Brazilian financial market. The government’s proposal helped the Ibovespa record a sharp rise while taking pressure off the exchange rate and projected interest rates on Thursday.
The external scenario also helped. The main foreign stock exchanges come from positive sessions in view of the perception that the worst of the recent banking crisis would be over.
But the saga of the new fiscal rule did not end with the presentation of the plan by the Minister of Finance, Fernando Haddad.
Although the proposal has been relatively well received by the market at this first moment, it will not please everyone. And Haddad knows it.
According to reports, he would have commented during a meeting with senators that it would be impossible to please Roberto Campos Neto (president of the BC) and Gleisi Hoffmann (president of the PT) at the same time.
In addition, the proposal still needs to go through Congress and there are some points that need to be clarified or deepened by President Luiz Inácio Lula da Silva’s economic team.
That’s why Haddad should spend most of this Friday meeting with financial market sharks in São Paulo.
The fact is that, despite the strong recovery of 5.9% observed in the week, the Ibovespa reaches the last session of the first quarter of the year 2.5% below the beginning of 2023.
To find out if the new fiscal framework will be enough to at least zero out the year’s losses on the Ibovespa, follow the coverage of Seu Dinheiro.
This article was first published in “Your Money in Your Morning”. To receive this content in your email, sign up for free at this link.
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Source: Moneytimes
I am an author and journalist with a focus on market news. I have worked for a global news website for the past two years, writing articles on a range of topics relating to the stock market. My work has been published in international publications and I have delivered talks at both academic institutions and business conferences around the world.
