Brazil's newly introduced fiscal framework is stricter than they appear and will require a discussion of important spending cuts, Gabriel Galipolo, the executive secretary of the Finance Ministry, said on Tuesday, Reuters reported. Lawmakers in the lower house of Congress last week passed the main text of legislation that is set to replace the current spending cap, which has been breached several times in recent years to allow higher government spending.
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A growing number of Venezuela-related expropriation claims at U.S. courts pursuing Citgo Petroleum's assets surpass $20 billion, making difficult for the Houston-based refiner to compensate them all, but some payments can be negotiated, said on Wednesday the chief of a board supervising the company, Reuters reported.
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Brazilians are struggling to pay their debts on time, with four out every ten adults facing default, as central bankers keep monetary policy tight in an effort to bring inflation back to their target, Bloomberg News reported. Overdue debts grew 18.42% in April from a year ago, according to data from the national confederation of shopkeepers reported by news site Poder360. The number of Brazilians facing default also grew around 8%, with most battling debts with local banks, the confederation said.
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Bonds of Unigel slipped into distressed territory on concern that poor results may put the chemical maker at risk of covenant violations, Bloomberg News reported. Dollar notes due in 2026 are down 34 cents since the firm posted its first-quarter earnings earlier this month, seen as weak by analysts. The plunge — the worst among Latin America’s corporate borrowers this quarter, according to data compiled by Bloomberg — sent yields jumping to more than 35%, from around 8% in January.
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Uruguayan fintech dLocal, the South American country's first unicorn, saw its shares plummet on Friday, after Argentine news outlet Infobae published an article saying the government was investigating it for a possible fraud of at least $400 million, Reuters reported. Citing unnamed official sources, Infobae said the Argentina government was investigating the fintech for "improper manouevers" and transfers abroad that would constitute a fraud, with most of its income coming from services sold to subsidiaries of the same firm.
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Chile’s central bank said there’s no evidence that the domestic inflation slowdown had been consolidated, even as headline consumer price and consumption readings head in the right direction, Bloomberg News reported. The only plausible monetary policy option was to keep rates unchanged at an over two-decade high of 11.25%, central bankers wrote in the minutes to their May 12 decision. The risks associated with scenarios of higher inflationary pressures were “particularly complex and costly,” they wrote.
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When Luiz Inacio Lula da Silva was Brazil’s leader from 2003 to 2011, he didn’t have to contend with an independent central bank, according to an analysis in The Washington Post. Reelected president in October, he has resisted the new reality created by a 2021 law enshrining the bank’s power to set monetary policy autonomously. He has called the law “nonsense” and publicly criticized the bank’s inflation goals and interest rates, creating tension with its chief, Roberto Campos Neto.
World stocks dropped on Wednesday as U.S. debt ceiling talks dragged on without resolution, stoking a general malaise in markets that saw safe-haven assets such as the dollar hold around recent highs, Reuters reported. But crude oil prices bucked the downtrend and kept rising, after a warning from the Saudi energy minister to speculators that raised the prospect of further OPEC+ output cuts. Negotiators for Democratic President Joe Biden and top congressional Republican Kevin McCarthy met again on Wednesday to end an impasse in talks.
Argentina’s government will tighten access to the foreign exchange market for oil companies that need to import amid a severe shortage of dollars, according to people with direct knowledge, Bloomberg reported. Central Bank President Miguel Pesce, Energy Secretary Flavia Royon and other officials informed oil company executives Wednesday morning that they will be required to finance import payments for 90 days. The policymakers met with executives of Raizen, Axion, YPF and Trafigura at the monetary authority to discuss the changes.
The U.S. Transportation Department (USDOT) said on Monday it fined LATAM Airlines Group SA $1 million after the airline and affiliates routinely failed to provide timely refunds to passengers for U.S. flights, Reuters reported. The department said since March 2020, it received more than 750 complaints alleging LATAM, the biggest carrier in Latin America, failed to provide timely refunds after canceling flights to or from the U.S. USDOT said it took LATAM more than 100 days to process thousands of refund requests to payment.