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Brazil set to unfreeze 10-15 bln reais in spending on Friday -source
September 21, 2017 / 9:04 PM / a month ago

Brazil set to unfreeze 10-15 bln reais in spending on Friday -source

BRASILIA, Sept 21 (Reuters) - Brazil’s government is preparing to unfreeze more than 10 billion reais ($3.18 billion) in spending on Friday because of a looser budget target to fend off a potential shutdown, a government source told Reuters.

The government has frozen 45 billion reais in spending to meet its budget target, a hallmark of efforts to restore investors’ confidence in Brazil after two years of recession.

The government nevertheless loosened the 2017 primary budget deficit goal last month to 159 billion reais from 139 billion previously as tax revenues faltered, opening the door for more spending without breaching fiscal rules.

The thaw to be announced on Friday remained under discussion as it depends on revenue estimates from judicial debts under a law approved in July.

The source said up to 15 billion reais could be made available for federal spending, but that number could fall by about 4 billion reais if the country’s attorney general does not endorse the new rules for judicial debt payment.

A second government source told Reuters the attorney general was expected to endorse the government’s plans on Thursday.

Planning Minister Dyogo Oliveira had initially been forecasting an thaw of between 8 billion to 10 billion reais to be announced at bimonthly budget review, due on Friday.

$1 = 3.1427 reais Reporting by Silvio Cascione and Marcela Ayres; Additional reporting by Ricardo Brito; Editing by Dan Grebler

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