Brazil Real Drops Amid Speculation Budget Gap to Rise to Record
- Budget deficit could be up to 50 billion reais, O Globo says
- Real is the worst performer among major currencies this year
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Brazil’s real declined amid renewed concern that the nation’s fiscal picture is worsening as the economy sinks into a recession.
Brazil’s government, which previously targeted a so-called primary surplus, may announce by Tuesday a budget deficit excluding interest payments of as much as 50 billion reais ($13 billion) this year, O Globo newspaper reported, without saying where it got the information. That would be the widest on record. The pessimism overwhelmed optimism on global growth generated by China’s move to cut interest rates and signals from the European Central Bank that it could act to stoke the economy.