Re-elected Lula faces meeting with Trump in Miami under fiscal pressure and clash with the Supreme Court
The agenda for the meeting does not appear in the text of Gazeta do Povo, but the new mandate already faces a rigid budget and rising debt
BY THE X-TRADER NEWS NEWSROOM · REPORTING FROM GAZETA DO POVO · 2 MIN
Lula was re-elected, and the post-election week is already marked by the articulation of a new mandate. At the same time, the Gazeta do Povo headline announces a meeting between Lula and Trump in Miami, but the text does not detail what is on the table. The question in the title about what Trump will charge, therefore, remains unanswered in the report itself, and this text will not fill that gap.
According to Gazeta do Povo, Flávio Bolsonaro left Brazil after a decision by Alexandre de Moraes, from the STF, which ordered the delivery of passports and restricted leaving the country. The report states that he had traveled through Argentina towards the United States, with a visa granted by the Trump administration. The case brings the relationship with Washington closer to an internal dispute with the Supreme Court.
In Congress, the opposition is betting on the Senate as a space to confront the STF, and the dispute for command of the House is already included in the calculation. In the conservative base, the desire is to move forward with proposals to impeach Supreme Court ministers, especially Moraes.
In São Paulo, Tarcísio de Freitas was re-elected governor and admits a possible candidacy for the Presidency in 2030, depending on the scenario and allies. In an interview with Estadão, according to Gazeta do Povo, he acknowledged the results of the polls and defended a responsible opposition to Lula. Experts consulted by the report assess that Brazil tends towards greater ideological isolation in Latin America, amid the advance of right-wing governments in the region.
In the same clash, Moraes stated that the STF's decision on possession of marijuana for personal use is being disregarded and cited doctors linked to medicinal cannabis treated as drug dealers, according to him.
In the economy, the budget is heavily compromised by mandatory expenses, which puts the new mandate under fiscal pressure. The report cites a projection according to which, without structural reforms, public debt could exceed 100% of GDP in the coming years.
What changes for the investor
The central point for those who operate interest rates, exchange rates, the stock market and the Nasdaq is the combination of two factors presented by the report: a budget without slack and a debt that, without reforms, could exceed 100% of GDP. This type of scenario is usually closely monitored by the market, because the perception of the fiscal trajectory weighs on interest and exchange rates. On the political side, the confrontation between the opposition, the Senate and the STF adds institutional noise, and a possible meeting with Trump will only have a clear effect when the agenda is known, which the report does not do. In the editorial line of The X-Trader News, fiscal responsibility is the criterion that investors should demand from any government. It is worth following the agenda of the meeting in Miami, the progress of reforms and the votes in the Senate. This analysis is not a recommendation to buy or sell and does not predict price movements.
Automatically translated from Portuguese.
