Synthesis of the Brazilian Economy
Below we describe how the government is losing support both in Brazil and abroad, and the aggravation of the fiscal-monetary conflict, culminating in slower growth and prolongation of high interest rates and inflation.
Without a master plan to define his third mandate able to identify bearings that can attract support and raise hopes, Lula continues to speak in public with the levity of a common citizen among friends, without evaluating the costs and benefits of that verbiage when expressed by a President of the Republic. Here we examine some of the effects of this atypical attitude on the economy, leaving investigation of its causes to specialists in other areas of knowledge.
Alongside the accumulation of gratuitous gaffes about racism, mental disorders and obesity that hark back to his predecessor, we have reiterated the negative impacts of his criticism of the Central Bank and its president, both regarding the unanchoring of inflation expectations and the higher cost of rolling over the public debt, as well as the erosion of an institution that has an exemplary international reputation.
Huge damage has also been done abroad, where a need exists to restore the country’s image, ravaged by Bolsonaro, through the efforts of the formerly popular metalworker who rose to the presidency. Unfortunately, after visiting seven countries in only 120 days since taking office, he has burned precious international political capital, exposing the country to threats of reprisals from the United States and European Union. What has changed?
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