Brazil’s Temer Outlines First Measures to Tame Budget Gap

Brazil’s Acting President Michel Temer outlined the first economic measures to regain investor confidence, which was shaken by the loss of a key cabinet member just 11 days after he took office.

Temer said on Tuesday he’ll ask Congress to limit subsidies and approve a cap on government spending, as part of an effort to tame a near-record budget deficit in Latin America’s largest economy. He also suggested he could shut down the country’s sovereign wealth fund and improve corporate governance at public pension funds and state-run companies such as Petroleo Brasileiro SA, the epicenter of a corruption scandal that has rocked the country for more than two years.

The announcement comes the day after Planning Minister Romero Juca was forced to step down over allegations he offered to obstruct the corruption probe, known as Carwash. Investor concern about the political fallout of the massive graft investigation has damped enthusiasm for the interim administration that took over during President Dilma Rousseff’s impeachment process.

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