As Brazil heads into an election, its debt problems are becoming harder to ignore. Consumers and businesses are struggling with sky-high borrowing costs as the country’s deteriorating fiscal outlook alarms investors. President Luiz Inácio Lula da Silva has rolled out measures aimed at easing the pressure on families and businesses while his main rival, Flávio Bolsonaro, has promised tighter spending controls, albeit with few details. Whoever wins the presidency is likely to face difficult choices over how to bring the country’s debt to heel.
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Graham Watson
onto International Economics: A-Level Economics September 26, 6:21 AM
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This Bloomberg clip looks at the implications of growing levels of debt in Brazil - both for the government and individuals, not least because of the deregulation of financial markets and increased use of credit cards. As interest rates have climbed, this has burdened the economy with increased debt repayments and some high profile firms have filed for bankruptcy.
Interestingly, President Lula da Silva has banned all online gambling overnight, hoping to tackle one aspect of the ongoing cost of living crisis.