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May 29, 2015

Brazil’s economy shrinks in 1st quarter, recession seen

BRASILIA, May 29 (Reuters) – Brazil’s economy shrank 0.2
percent in the first quarter, setting the stage for a likely
recession this year as companies slash investments and leftist
President Dilma Rousseff tries to atone for policy missteps from
her first term in office.

The economy’s performance, reported by the government
statistics agency on Friday, was better than median market
expectations of a 0.5 percent contraction in a Reuters poll.

May 29, 2015

Brazil eases bank reserve requirements to bolster home lending

BRASILIA, May 28 (Reuters) – Brazil’s central bank on
Thursday eased reserve requirements to encourage housing and
agribusiness lending, but raised returns on term deposits kept
at the bank, in a move that officials said will have a neutral
effect on monetary policy.

In a joint decision with the country’s top economic body,
the national monetary council, known as CMN, the central bank
said it will allow banks to deduct up to 18 percent of their
compulsory requirements as long as they use the money for
housing financing.

May 28, 2015

Brazil central gov’t surplus widens, goal still distant

BRASILIA, May 28 (Reuters) – The primary budget surplus of
Brazil’s central government improved in April from the previous
month, but the result was not enough to turn around public
finances and meet an important fiscal goal this year.

The primary surplus totaled 10.085 billion reais ($3.18
billion) in April, the Treasury said on Thursday. That was up
from a surplus of 1.464 billion reais in March, but well below
last year’s 16.612 billion reais.

May 27, 2015

Brazil’s Senate passes weakened austerity measure to balance budget

BRASILIA, May 26 (Reuters) – Brazil’s Senate on Tuesday
approved a watered-down version of an austerity measure that
curbs labor benefits as part of President Dilma Rousseff’s bid
to restore investor confidence in her management of the
country’s stagnant economy.

The measure, known as provisional measure 665, was supposed
to save the government 9 billion reais ($2.86 billion) a year,
but amendments by lawmakers reduced that to about 5 billion
reais.

May 22, 2015

Brazil delivers hefty spending freeze to regain credibility

BRASILIA RIO DE JANEIRO (Reuters) – Brazil unveiled a spending freeze on Friday, limiting outlays to about 70 billion reais ($23 billion) in a bid to convince investors that President Dilma Rousseff is committed to saving the nation’s investment-grade rating.

To strengthen the impact of the announcement, Rousseff earlier on Friday also ordered an income tax increase for banks, a clear sign that her government is ready to push ahead with austerity despite stiff political opposition.

May 22, 2015

Brazil central bank chief vows to slash inflation by end-2016

RIO DE JANEIRO, May 22 (Reuters) – Brazil’s central bank
chief on Friday renewed his commitment to slash inflation to the
center of a government target by the end of 2016, signaling more
interest rate hikes in Latin America’s largest economy.

Speaking at a central bank event in Rio de Janeiro,
Alexandre Tombini stressed that policymakers would remain
“vigilant” to ensure the inflationary impact of sharp rises in
government-managed prices this year does not spread out into
2016 and beyond.

May 21, 2015

Brazil economic activity tanks, unemployment surges as recession looms

SAO PAULO/BRASILIA, May 21 (Reuters) – Economic activity in
Brazil tumbled in the first quarter and unemployment climbed to
a near four-year high, adding to signs of a painful recession
that could worsen as President Dilma Rousseff clamps down on
spending.

The central bank said on Thursday its IBC-Br economic
activity index dropped 0.8 percent in the first quarter from the
last three months of 2014, after sliding more than expected in
March.

May 19, 2015

Brazil sees monetary, fiscal alignment taming inflation -source

BRASILIA, May 19 (Reuters) – Brazil’s government is
confident that greater coordination between monetary and fiscal
policies will help bring inflation back on target by late 2016,
despite market skepticism, a senior official told Reuters on
Tuesday.

Traders’ forecasts, however, that Brazil will cut interest
rates early next year are premature, the official added.

May 15, 2015

Brazil risks losing $1.7 billion with payroll tax bill changes

BRASILIA (Reuters) – The Brazilian government’s proposal to roll back tax breaks as part of its austerity drive is being diluted in Congress and the country could lose 5 billion reais ($1.7 billion) in tax revenue this year, the lawmaker drafting the changes said on Thursday.

Leonardo Picciani, leader of the PMDB party in the lower house of Congress, told Reuters he is proposing the rollback to start gradually next year. The government wanted the measure to take effect this year to raise 5 billion reais in 2015 and 13 billion reais in 2016.

May 11, 2015

Brazil to sweeten infrastructure package to woo investors -officials

BRASILIA, May 11 (Reuters) – Brazil could offer an improved
rate of return for investment in multibillion-dollar projects
aimed at overhauling its aging infrastructure and ease
requirements as it seeks to lure more private capital, five
officials close to policy talks told Reuters.

A fiscal austerity push that cut government financing has
forced President Dilma Rousseff to sweeten the terms of a
package of measures aimed bringing more competition to upcoming
auctions of concessions for airports, roads and ports across
Brazil.

    • About Alonso

      "Alonso has worked for more than a year covering commodities in the world's top copper producer Chile. A native of Nicaragua he has workers for Thomson Reuters for nearly five years with several stints in other Latin American countries. He is a University of Missouri-Columbia graduate."
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