According to BNDES, fiscal adjustment should be even greater.

The Brazilian National Bank for Economic and Social Development (BNDES) argues that the fiscal adjustment for 2015 should reach R$ 100 billion, R$ 20 billion more than projected by the economic team. According to the analysis contained in the document, "the required adjustment will now be almost R$ 100 billion" and that "the greater the economic slowdown, the greater the negative impact on primary revenues, which would make the task more difficult in the event of a lower-than-expected GDP," says the text signed by the institution's president, Luciano Coutinho.

March 02, 2015, 18:19 PMUpdated July 05, 2018, 01:36 pm

The Brazilian National Bank for Economic and Social Development (BNDES) argues that the fiscal adjustment for 2015 should reach R$ 100 billion, R$ 20 billion more than projected by the economic team; according to the analysis contained in the document, "the required adjustment will now be almost R$ 100 billion" and that, "the greater the economic slowdown, the greater the negative impact on primary revenues, which would make the task more difficult in the event of a lower GDP than expected," says the text signed by the institution's president, Luciano Coutinho (Photo: Paulo Emílio).

247 - The Brazilian National Bank for Economic and Social Development (BNDES) argues that the fiscal adjustment for 2015 should reach R$ 100 billion, R$ 20 billion more than projected by the economic team. This assessment is included in the quarterly management report on Treasury Resources and is signed by the institution's president, Luciano Coutinho.

According to the analysis contained in the document, "the required adjustment will now be almost R$ 100 billion" and that, "the greater the economic slowdown, the greater the negative impact on primary revenues, which would make the task more difficult in the event of a lower GDP than expected," the text says.

Despite this caveat, BNDES emphasizes that the measures the government intends to implement will ensure "greater fiscal soundness, higher levels of confidence, and greater sustainability of long-term growth." However, the bank assesses that in the short term, the measures are likely to result in a "contractionary" impact on the economy's performance.

Last week, Planning Minister Joaquim Barbosa had already observed that the fiscal adjustment could have a recessionary character at first.