| SAO PAULO
SAO PAULO May 16 The Brazilian government is
creating a department to foster relations with and explain
policy moves to market participants, a source with direct
knowledge of the plans said on Friday, after almost four years
of confusing economic policy steps.
The creation of an investor relations office aims to align
broader policy goals with those of entities under the umbrella
of Brazil's finance ministry, such as the National Treasury and
the tax authority, said the source, who declined to be
identified because the decision has not been made public.
Top officials in President Dilma Rousseff's administration
are aware that business leaders and investors are wary of
government actions, partly due to mixed fiscal and monetary
policy signals, the source noted. "The government needs to
improve its communication channels with the markets," the
By seeking to unify its policy speech and deliver it in a
uniform way, the government is seeking to mitigate any potential
volatility on the road to the October presidential election.
Rousseff is expected to run for a second, four-year term.
Over the past three years, Brazil's local stock market,
mergers and acquisitions deals and stock offerings have
suffered, partly due to eroding confidence in Rousseff's
handling of the economy as growth slowed and inflation
quickened. Political wrangling ahead of the election as well as
Rousseff's tendency to meddle excessively in the economy has
hurt investor confidence, investors and analysts including Tony
Volpon of Nomura Securities have said.
Yet in recent months, signs of a more business-friendly
economic policy framework has emboldened investors and bankers.
President Dilma Rousseff's push to woo investment in
infrastructure is fanning optimism that interference will wane.
(Editing by Guillermo Parra-Bernal and Diane Craft)