Dilma Rousseff may take “bold and unexpected policy actions,” including budget cuts to allow for lower interest rates, if she holds onto a “commanding” lead and is elected Brazil’s president, according to a Nomura Securities International Inc. report.
Brazil’s economy probably expanded at the fastest pace in President Dilma Rousseff’s tenure in the second quarter, a clip analysts forecast is unsustainable as the central bank raises interest rates and the currency plunges.
They arrive every week, in ones and twos and groups of 10, some of them coming straight from Sao Paulo’s Guarulhos International Airport. These investors head for the dark-wood halls of Credit Suisse Hedging-Griffo as supplicants, asking to put their millions of dollars into one of the world’s top-performing hedge funds.
The record rout in Brazilian bonds is deepening on speculation President Dilma Rousseff’s vow to boost spending to placate protesters will swell the budget deficit at a time when a stagnating economy saps tax revenue.
Luciano Coutinho oversaw a surge in lending as president of Brazil’s development bank that increased the country’s debt during the global financial crisis. Now he may need to help Dilma Rousseff restrain government spending when she becomes president.
Brazil’s real-denominated global bonds rallied after the central bank accelerated the pace of interest-rate increases, a move that could stem a currency rout that has eroded returns on the country’s debt.
The return to power of Luiz Inacio Lula da Silva, the mentor and predecessor of Brazil President Dilma Rousseff, is gaining traction among her supporters as her party faces a 2014 election having delivered the slowest average growth in 24 years.