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Report: Brazil's Rousseff considering cut in banks' reserve requirements as impeachment looms

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Report: Brazil's Rousseff considering cut in banks' reserve requirements as impeachment looms

Brazil's PresidentDilma Rousseff is looking to decrease banks' reserve requirements to boost creditand revive a recession-struck economy, Reuters reported April 12, citing an unnamedpresidential aide.

Measures tokeep the economy afloat will be put up in case the Congress proceeds with an impeachmentvote against Rousseff on April 17, the Reuters source said. Aside from the reductionin reserve requirements, the government could also raise the social program spendingfor the poor like the so-called "Bolsa Familia" cash transfer program,the official noted.

An announcementto post another primary budget deficit in 2017 could also be made, the officialsaid, in an effort to lift public investment in infrastructure to boost growth.The government could announce its new fiscal targets April 15.

Earlier reportssaid Brazilian banks and government members are urging BancoCentral do Brasil to ease capital requirements to banks amid the risingdefault threats from large local companies. The idea is to have the central bankease capital requirements with the condition that such amounts will be allocatedto refinancing lines of credit in order to allow indebted companies to redeem securitiesissued abroad.