Economics

Brazil’s Campos Neto Warns of Market Wrath If Spending Not Cut

Fiscal detour will be corrected next year, Campos Neto says
Central banker speaks at Bloomberg Emerging & Frontier Forum

Brazil's Economy Expected to Shrink 5% This Year Says Neto

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By Mario Sergio Lima and Erik Schatzker

September 2, 2020 at 2:38 PM UTC

Updated on

September 2, 2020 at 5:20 PM UTC

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Central bank President Roberto Campos Neto said Brazil must resume fiscal austerity following this year’s record pandemic spending or risk being punished by financial markets.

Brazil’s emergency measures are all set to expire by the end of 2020 and lawmakers have signaled they won’t be extended, Campos Neto, 51, said on Wednesday at the Bloomberg Emerging + Frontier Forum. He added that history has shown that growth driven by public spending hasn’t worked in Brazil.