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Finance Ministry Presents New Fiscal Framework, USDBRL Rises

BRAZIL
  • Brazil Framework Limits Govt Spending Growth to 70% of Revenue Growth
  • Brazil Govt Expenditure To Rise By 0.6%-2.5% Yearly
  • Brazil to curb expense growth if primary balance below target
  • Brazil proposes using above-target revenue for investments
  • Brazil govt to set a minimum expenditure for investments
  • Primary Budget Targets as set out in overnight source reports:
    • Brazil Sets Primary Budget Deficit Target for 2023 at 0.5% of GDP
    • Brazil 2024 Goal Is for Balanced Primary Budget
    • Brazil 2025 Goal Is for Primary Surplus of 0.5% of GDP
    • Brazil 2026 Goal Is for Primary Surplus of 1.0% of GDP (DJ)
  • Coinciding with a brief rebound for the greenback, however, USDBRL popping on these initial headlines, closing the gap with yesterday's close and rising to 5.1600 as of writing.

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