{"id":12047,"date":"2015-09-09T18:29:47","date_gmt":"2015-09-09T23:29:47","guid":{"rendered":"http:\/\/olduvai.ca\/?p=12047"},"modified":"2015-09-09T18:29:47","modified_gmt":"2015-09-09T23:29:47","slug":"brazil-cut-to-junk-by-sp-etf-falls-5-post-mkt","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=12047","title":{"rendered":"Brazil Cut To Junk By S&#038;P, ETF Falls 5% Post-Mkt"},"content":{"rendered":"<h3 class=\"title\"><a href=\"http:\/\/www.zerohedge.com\/news\/2015-09-09\/brazil-cut-junk-sp-etf-falls-5-post-mkt\" target=\"_blank\">Brazil Cut To Junk By S&amp;P, ETF Falls 5% Post-Mkt<\/a><\/h3>\n<p>It\u2019s not as if the writing wasn\u2019t on the wall, and don\u2019t say we didn\u2019t warn you.<\/p>\n<p>Brazil, whose economy\u00a0<a href=\"http:\/\/www.zerohedge.com\/news\/2015-08-28\/no-recovery-you-brazil-officially-enters-recession-goldman-calls-numbers-disquieting\">officially slid into recession<\/a>\u00a0in Q2 &#8211; a quarter during which Brazilians suffered through the worst inflation-growth outcome (i.e. stagflation) in over a decade &#8211; and whose efforts to plug a yawning budget gap are complicated by political infighting and a growing public outcry against embattled President Dilma Rousseff,\u00a0<strong>has been cut to junk by S&amp;P.\u00a0<\/strong><\/p>\n<ul>\n<li><strong>BRAZIL CUT TO JUNK BY S&amp;P; OUTLOOK NEGATIVE<\/strong><\/li>\n<\/ul>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/www.zerohedge.com\/sites\/default\/files\/images\/user92183\/imageroot\/2015\/09\/BrazilianFan.png\" alt=\"\" width=\"350\" height=\"234\" \/><\/p>\n<p>Unsurprisingly, the iShares MSCI Brazil ETF is trading sharply lower AH on the announcement:<\/p>\n<p><a href=\"http:\/\/www.zerohedge.com\/sites\/default\/files\/images\/user92183\/imageroot\/2015\/09\/20150909_EWZ.jpg\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/www.zerohedge.com\/sites\/default\/files\/images\/user92183\/imageroot\/2015\/09\/20150909_EWZ_0.jpg\" alt=\"\" width=\"600\" height=\"334\" \/><\/a><\/p>\n<p>S&amp;P\u2019s move comes as the country\u2019s finance minister fights for his political life and as deficits on both the current and fiscal accounts paint a bleak picture, especially in the face of persistently low commodity prices, China\u2019s move to devalue the yuan, and the impossible dilemma facing the central bank which, like its \u201cLA-5\u201d counterparts,\u00a0<a href=\"http:\/\/www.zerohedge.com\/news\/2015-09-03\/fx-traders-fear-worst-case-scenario-brazil-finmin-cancels-travel-plans-rousseff-meet\">can\u2019t hike to combat<\/a>\u00a0a plunging currency for fear of exacerbating FX pass through inflation and can\u2019t cut to boost the economy for fear of jeopardizing the 2016 4.5% inflation target.<\/p>\n<p><a href=\"http:\/\/www.zerohedge.com\/sites\/default\/files\/images\/user92183\/imageroot\/2015\/09\/Selic.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/www.zerohedge.com\/sites\/default\/files\/images\/user92183\/imageroot\/2015\/09\/Selic.png\" alt=\"\" width=\"608\" height=\"309\" \/><\/a><\/p>\n<p>Expect this to get far, far worse before it gets better. Here\u2019s the headline dump:<\/p>\n<ul>\n<li>S&amp;P SEES BRAZIL REAL GDP CONTRACTION OF ABOUT 2.5% THIS YEAR<\/li>\n<li>S&amp;P SEES BRAZIL REAL GDP CONTRACTION OF 0.5% IN &#8217;16<\/li>\n<li>S&amp;P SEES BRAZIL REAL GDP MODEST GROWTH IN 2017<\/li>\n<li>BRAZIL GOVT DEFICIT TO RISE TO AVG 8% GDP IN &#8217;15, &#8217;16, S&amp;P SAYS<\/li>\n<li>BRAZIL WON&#8217;T HAVE PRIMARY FISCAL SURPLUS IN &#8217;15, &#8217;16: S&amp;P<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>Here&#8217;s a look at the country&#8217;s twin deficits:<\/p>\n<p><a href=\"http:\/\/www.zerohedge.com\/sites\/default\/files\/images\/user92183\/imageroot\/2015\/08\/BrazilBadNewsBudgets.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/www.zerohedge.com\/sites\/default\/files\/images\/user92183\/imageroot\/2015\/09\/BrazilAccounts_0.png\" alt=\"\" width=\"600\" height=\"470\" \/><\/a><\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Brazil Cut To Junk By S&amp;P, ETF Falls 5% Post-Mkt It\u2019s not as if the writing wasn\u2019t on the wall, and don\u2019t say we didn\u2019t warn you. Brazil, whose economy\u00a0officially slid into recession\u00a0in Q2 &#8211; a quarter during which Brazilians suffered through the worst inflation-growth outcome (i.e. stagflation) in over a decade &#8211; and whose [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[90,177,7001,8858,696,4318],"class_list":["post-12047","post","type-post","status-publish","format-standard","hentry","category-economics","tag-brazil","tag-credit-rating","tag-dilma-rousseff","tag-junk-rating","tag-sp","tag-zerohedge"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/12047","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=12047"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/12047\/revisions"}],"predecessor-version":[{"id":12048,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/12047\/revisions\/12048"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=12047"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=12047"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=12047"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}