Moody’s and S&P: Base scenario for Brazil is respecting the spending cap, but there are risks

Moody's and S&P's believe the spending cap will be respected, even after the approval of the 2021 Budget last week by the Chamber of Deputies,.

RIO DE JANEIRO, BRAZIL - "Our baseline scenario continues to be compliance with the spending cap. There may be reallocation [of spending within the ceiling], but that depends on the authorities," commented Samar Maziad, vice president and senior analyst at Moody's, in an interview with Valor.

According to her, Moody's has been pointing out for some time that the fiscal issue is the main weakness of the Brazilian rating, which only increased last year, with the large fiscal package to combat the pandemic, which made the debt approach 90% of GDP.

Now, however, Samar points out that the main . . .

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