Brazil: Bankers rueful over Rousseff
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Brazil: Bankers rueful over Rousseff

Brazil’s banking industry exclaimed loudly that another four years of Dilma Rousseff would be a disaster for the country. Now that she has been re-elected, have the bankers changed their minds?

Brazilian president Dilma Rousseff

The sight of an opposition march down Faria Lima on October 22 will live long in the memory of those well-heeled manifestações who took part. Bankers, CEOs and CFOs joined a popular protest against the incumbent president Dilma Rousseff that made its way slowly down the avenue, which is flanked by the shiny new glass headquarters that make up Brazil’s new financial heartland.

The short elevator journey from business suite to street illustrated just how much resentment festers within the business community against the ruling PT party – as well as how much more money they thought they could make under an Aécio Neves presidency.

Then Rousseff won, albeit it closely. The markets braced for the impact from the warnings of financial and economic Armageddon to come. But the pre-election volatility subsided. The currency devalued, but in slow and orderly fashion. The stock market bounced around but less than anticipated.

In finance, optimism springs eternal. Bankers and traders soon began to convince themselves that the closeness of the election and Rousseff’s admission in her victory speech of failures, as well as her promises to be a better president in her second term (despite no conciliatory mention of either of the two leading defeated candidates of the bitter campaign), meant that Dilma Mark II would be OK after all.

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