Brazil’s real led declines among the world’s most-traded currencies ahead of an expected announcement that the government will lower next year’s budget target, underscoring its inability to shore up the country’s finances.
President Dilma Rousseff’s supporters on the congressional budget committee will introduce an amendment to the 2016 budget bill that would allow the administration to aim for a surplus before interest payments of 0.5 percent of gross domestic product, said Paulo Pimenta, the government’s leader on the committee. Rousseff previously wanted to target a so-called primary surplus of 0.7 percent.
The move, which was said to be opposed by Finance Minister Joaquim Levy, is seen by analysts as a potential trigger to further credit-rating downgrades and possibly even the exit of Levy from Rousseff’s administration. The currency lost 2 percent to 3.9521 per dollar at 9:38 a.m. in Sao Paulo, the largest decline among 31 major currencies tracked by Bloomberg.
Brazil Energy Insight 
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