Petroleo Brasileiro SA’s failure to disclose the method it uses to set domestic fuel prices means the state-run oil company will have to rely on production growth to boost its stock, BlackRock Inc.’s Will Landers said.
Brazil’s economy shrank in the third quarter more than analysts forecast as above-target inflation, deteriorating fiscal accounts and rising interest rates sapped confidence and crimped investment. Swap rates fell.
Petroleo Brasileiro SA fell the most in five years after the government failed to meet a request by the state-run company to disclose a clear policy for phasing out fuel subsidies that have cut earnings and increased debt.
The Ibovespa sank the most among the world’s biggest stock gauges as Petroleo Brasileiro SA signaled it will keep subsidizing fuel prices, stoking concern that Brazil’s economic policies are hurting corporate profits.
Brazil’s central bank probably will raise the benchmark interest rate for a sixth straight meeting in an effort to convince investors that policy makers are serious about slowing inflation back to its target.