Brazil's economic growth may accelerate to a 3.5% annual rate in the second half of the year after the approval of pension reforms, Economy Minister Paulo Guedes said in an interview with TV channel Globo news.
The economy ministry, central bank and private sector economists have downgraded their 2019 growth forecasts in recent weeks as the economy has struggled to gain traction. The gloomier predictions are now around 1.5% or even lower.
Guedes said the government was considering ways of strengthening supervision of pension funds that manage retirement of employees of state-controlled companies.
The minister also advanced that he believes the government’s pension reform proposal, which many see as crucial to steadying the country’s rickety public finances, will be voted on in Congress within two to four month
Meanwhile leaders of Brazil’s largest parties in Congress have delayed to next week an expected vote to start discussion in parliament on the country’s pension reform.
House Speaker Rodrigo Maia said he expected the committee to approve the discussion in a vote on Tuesday next week.
The government leader in the House, deputy Major Vitor Hugo (PSL-GO), confirmed that the vote, the first step to start discussing the draft reform, is now expected to take place next week.
Brazil’s currency, the real, weakened more than 1% to 3.9453 against the U.S. dollar, as traders cited worries that the government was struggling even with the preliminary steps toward passing the reform, which is seen as crucial to reining in a budget deficit and reigniting economic growth.