Brazil's Senate on Oct. 22 voted 60-19 to approve the main text of a pension reform bill, Reuters reported.

The approval of pension reform has been a key target of President Jair Bolsonaro's administration, as many believe that the fiscal power that it will garner will help the country to stabilize its public finances and have a direct impact on the wider economy.

Although the initial pension reform was supposed to save 1.237 trillion reais in the coming ten years, that amount came down to 800 billion reais during the first vote in the Senate.

A few remaining amendments to the bill are expected to be approved in the Senate later today. If they are passed, Bolsonaro will have the power to sign the reform into law.

Following the Oct. 22 passage of the main text of the long-awaited overhaul, the Bovespa stock exchange rose 1.1%, while the Brazilian real was up more than 1% in the same day for the first time in more than two weeks to 4.06 reais against a dollar.

According to Moody's senior analyst for Brazil's sovereign rating, Samar Maziad, the "Senate approval of the social security reform completes a crucial step towards preserving Brazil's fiscal sustainability. The reform and its expected savings, around [800 billion reais], supports Brazil's credit profile and its Ba2 rating, and is incorporated in Moody's baseline scenario."

In a statement, Maziad said the rating agency expects "the authorities to continue pushing their structural reform agenda as they seek to improve growth on a sustained basis over the coming years by encouraging private sector investment in infrastructure, and simplifying the tax regime."

As of Oct. 22, US$1 was equivalent to 4.07 Brazilian reais.