Rousseff Approval Falls First Time Since 2013 Protests

Brazilian President Dilma Rousseff’s approval rating fell for the first time since street protests last year pushed her popularity to a record low.

Approval of Rousseff’s way of governing fell to 51 percent in March from 56 percent in December, an Ibope poll published by the National Industry Confederation showed today. Her government’s approval rating slipped to 36 percent from 43 percent over the same period, according to the survey that polled 2,002 Brazilians from March 14 to 17 and has a margin of error of two percentage points.

The approval of Rousseff’s management style plunged to a record low 45 percent in July after more than one million people protested in Brazil’s main cities over cost of living increases and poor public services. Rousseff, who is expected to run for a second term in October, is struggling to contain above-target inflation, while reviving economic growth that in her first three years in office was the slowest of any Brazilian president since Fernando Collor, who resigned over corruption charges in 1992.

“Dilma left the comfort zone,” Andre Cesar, director of consulting firm Prospectiva, said by phone from Brasilia. “If other polls confirm the downward trend, her situation will become complicated.”

Economic Issues

Her approval ratings fell in all of the nine policy categories surveyed, including health, education and public security. She performed worst on economic issues such as combating inflation and unemployment, the poll showed.

After the poll was released, the real reversed an earlier decline. It rose 0.9 percent to 2.2817 per U.S dollar at 11:33 local time.

“The market does not agree with this government’s economic policy,” said Paulo Petrassi, head of fixed income trading at Leme Investimentos.

The central bank said today that inflation in 2014 would accelerate for the second straight year and that there was a 40 percent chance it could exceed the 6.5 percent upper limit of its target range. The unemployment rate rose to 5.1 percent in February, a record low for the month, from 4.8 percent a month earlier, the national statistics agency IBGE said today.

“The biggest economic question is precisely inflation,” Renato da Fonseca, executive manager of surveys and competitiveness at the industry confederation, told reporters in Brasilia. “If the government can manage to reverse the process of inflation, it can stop this trend in the approval rating.”

Slower Growth

Economic growth will ease to 1.7 percent in 2014 from 2.3 percent last year as inflation accelerates to 6.28 percent from 5.91 percent last year, according to about 100 analysts surveyed by the central bank on March 21. Inflation, which slowed in the first two months of 2014 from 2013, has run faster than the 4.5 percent target since Rousseff entered office in 2011.

Brazil this week suffered its first sovereign rating downgrade in a decade. Standard & Poor’s, which said sluggish economic growth and an expansionary fiscal policy are fueling an increase in the country’s debt levels, downgraded the government one level to BBB-, its lowest investment-grade rating, from BBB.

(Corrects spelling of Rousseff’s name in second paragraph of story originally published on March 27.)
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