Ibovespa opens lower, with unemployment data and urgency in the fiscal framework

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Yesterday, the main index of the Brazilian stock market rose 1.17%, to 109,459 points. Ibovespa Freepik The Ibovespa, the main index of the São Paulo stock exchange, the B3, opened lower this Thursday (18), after approval of the urgency of the fiscal framework in the Chamber of Deputies and with the disclosure of employment data by the Institute Brazilian Institute of Geography and Statistics (IBGE). At 10:05 am, the index fell 0.25%, at 109,190 points. See more quotes. On the eve, the Ibovespa rose 1.17%, to 109,459 points. With the result, the index started to accumulate: Increase of 0.92% in the week; Gains of 4.81% in the month; Reduction of 0.25% in the year. What is messing with the markets? Late yesterday afternoon, the Chamber of Deputies approved the urgent request for the processing of the project that establishes the new fiscal framework by 367 votes in favor and 102 against. The mayor, Arthur Lira, said that the text will be voted on next week and the markets are still waiting for it. The project replaces the current spending cap rule, which limits the increase in Union spending based on the previous year’s inflation. The proposal for the new framework, presented by rapporteur Claúdio Cajado, links this increase in spending to government revenue growth, but has triggers and sanctions in case of non-compliance with fiscal targets. The text foresees that: a bimonthly evaluation of revenues and expenses should be carried out; public spending growth is limited to 70% of government revenue growth, if the target is met (example: if revenue rises by 2%, expenditure may increase by up to 1.4%); public spending growth is limited to 50% of government revenue growth, if the target is not met (example: if revenue rises by 2%, expenditure may increase by up to 1%); even if government revenue grows significantly, it will be necessary to respect a fixed interval in the real growth of expenses, varying between 0.6% and 2.5%, disregarding the inflation of the period. Still in the domestic scenario, the IBGE announced this morning that the unemployment rate in Brazil rose in 16 of the 27 Federation Units in the first quarter of 2023, according to the National Household Sample Survey (PNAD) Continuous Quarterly. LEARN MORE: Unemployment rises in 15 states and the DF in the first quarter of 2023, says IBGE In global markets, the highlight remains the renegotiation of the US debt ceiling. The government wants to raise the ceiling so that it can cover its expenses, including ordinary ones, such as paying salaries to federal civil servants. There was a certain impasse in the negotiations between the political parties. The Democrats, under President Joe Biden, are in favor of the increase, while part of the Republicans are against it. Expectations, however, became more positive after Biden’s talks with the Speaker of the House of Representatives, Kevin McCarthy, to reach an agreement. Initial plugin text

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