Brazil will have to boost spending to fight poverty

Worrying trend: People line up at a rapid Covid-19 testing site in Belo Horizonte. Concerns about Brazil’s fiscal outlook have been weighing more heavily on financial markets as it battles the spread of the pandemic. — Reuters

BRASILIA: Brazil’s next president will have to temporarily increase public spending to fight poverty and unemployment, according to a close economic adviser to Luiz Inacio Lula da Silva, who leads opinion polls ahead of the October vote.

Nelson Barbosa, a former finance minister during the administration of Dilma Rousseff, a Lula ally, said financial markets have already realised that the current rule limiting the growth of public expenditures to the inflation rate “is unfeasible.”