Brazil ETF Longs for Stability Amid Political Turmoil

“The Brazilian Social Democratic Party, the main ally of President Michel Temer, said on Monday it would stay in his coalition for now, despite a move by younger members to break away from the scandal-plagued government,” reports Reuters. “Speaking at an executive meeting of the PSDB, they said a decision to stick with Temer was based on the need to support his austerity measures in Congress to balance Brazil’s overdrawn fiscal accounts.”

Earlier this year, federal police carried out search and arrest warrants throughout the capital in response to O Globo reports on leaked testimony indicating that Temer approved payoffs to acquire the silence of Eduardo Cunha, the man behind last year’s ouster of former president Dilma Rousseff.

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“Senior PSDB leaders managed to hold back a movement by younger lawmakers who want to quit the government and pull the four PSDB ministers out of Temer’s cabinet,” according to Reuters. “Many of the party’s 46 lawmakers in the lower chamber of Congress wanted to abandon Temer’s coalition. They are worried voters will punish them at the polls next year for being part of a government widely perceived as corrupt.”

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