Lula’s campaign communications coordinator, Edinho Silva, stated that the president-elect gives predictability to the market by recognizing that there will be an increase in the fiscal deficit to accommodate social spending. For him, the market’s reaction to Lula’s statements about fiscal and social responsibility was disproportionate and speculative. “We live in a shambles in the country because people suffer for what they interpret. What did Lula do to generate all this instability? Anything. It was an interpretation they made to act in a speculative way,” he told journalists as he left the Centro Cultural Banco do Brasil, seat of the transitional government.
In his first speech in Brasília, after the results of the elections, Lula questioned why people need to be made to suffer in order to guarantee this country’s fiscal stability. The president-elect also criticized the cut in spending in the social area with the aim of creating a fiscal surplus.
After a fall in the stock market and a rise in the market, several interlocutors went out to put out the fire. Edinho Silva stated that Lula’s speech gives the elected government transparency and allows the market to organize itself.
“We are in a very serious situation. The country has a deficit and will have discontinuity of programs and projects. We are saying to Brazil: there will be a deficit here and it will increase. And over time we bring that deficit into the budget. That’s predictability. It’s everything the market wants. This is you governing with a prospect of economic stability,” he said.
There are doubts about the new government’s plans regarding the spending cap, which Lula has already said will end, but he did not indicate what and how to replace it as a fiscal anchor, that is, a lock on public spending. Lula’s ally preached that, even so, the administration will be responsible. “Once the president-elect becomes president and we have all the instruments for managing the economy, we will manage much better than the current government. It fits. At this point, there is no way.”
Source: CNN Brasil
Joe Jameson, a technology journalist with over 2 years of experience, writes for top online news websites. Specializing in the field of technology, Joe provides insights into the latest advancements in the industry. Currently, he contributes to covering the world stock market.
