Market praises transition team at the center of the economy

The appointment of economists Persio Arida, André Lara Resende, Nelson Barbosa and Guilherme Mello to the transition team of president-elect Luiz Inácio Lula da Silva (PT) was well received by the financial market, but the move is still seen as insufficient to clarify which will be the direction of economic policy for the next four years.

Analysts await the definition of who will be the Minister of Finance and what the counterparts are for the increase in spending next year to guarantee, for example, the maintenance of the Auxílio Brasil of R$ 600 (which should be renamed Bolsa Família).

Among the names nominated, Persio Arida is seen as the closest to a fiscal responsibility agenda. He is one of those responsible for the Real Plan, participated in the Itamar and FHC governments and worked in the financial market in recent years.

There is no unanimous view on the other names. André Lara Resende, also one of Real’s fathers, has a history of more liberal positions when he was in government, but in recent years he has become a critic of more orthodox economic thinking.

Two other names are linked to the PT, that of ex-minister Nelson Barbosa, the last head of the Treasury under Dilma Rousseff and a columnist for the Sheetand Guilherme Mello, professor at Unicamp (State University of Campinas).

“These are great names. Most have already been in government. This team has everything to yield, but we still have to know who will be the coach”, says Mauro Morelli, strategist at Davos Investimentos, pointing out the lack of definition on who will be the minister. of the area.

Geizebel Schieferdecker, economist at Squad Capital Investimentos, says that the financial market reacted well to the nominations, especially from Persio and Lara Resende, who have a slightly more liberal background.

“The names indicated are more towards the center. Persio tends to have a more positive response [do mercado]🇧🇷 And you have some related to the PT, but that also bring a little more credibility in relation to fiscal responsibility”, says the economist.

Gustavo Cruz, strategist at RB Investimentos, also cites the most positive reaction to the name of Persio Arida, but states that the list does not provide a clear indication of what the new government’s direction will be in the economic area.

“The name that the market wants to hear is who will be the Minister of Finance”, says Cruz, who believes in a positive reaction to a political name.

Within the PT, the most cited for the economic area are federal deputy Alexandre Padilha (PT-SP) and senator-elect Wellington Dias (PT-PI). The signal that the former mayor of São Paulo Fernando Haddad would also be in the race generated a negative reaction from analysts in recent days.

In addition to knowing the owner of the Treasury, economists are awaiting a definition on the size of the license to spend that is being negotiated by the elected government with Congress.

Joaquim Paulo Kokudai, from Somma Investimentos, says it is important to guarantee resources for the Auxílio Brasil of R$ 600, but believes that other campaign promises could be discussed after the new president takes office, with a definition on how to fit an estimated expenditure in R$ $175 billion above the budget ceiling.

“As the two candidates were in favor of the R$ 600, and Congress approved it for this year, it should focus on that. Next year, wanting to do more things, I could see where it will come from, if it will increase revenue, cut expenses , to do something more consistent, not a palliative”, he says.