From: Daniel Sabba •t: > To: "'Jeffrey E."' <[email protected]> CC: Paul Morris , Vahe Ste anian Arian Dwyer Subject: FW: Faria: Brazil Daily Update [C] Date: Fri, 04 Sep 2015 18:31:55 +0000 , Stewart Oldfield , "'Richard Kahn"' Classification: Confidential Relevant Brazil update. 5y on the run CDS at 384. USDBRL 3.8485. My impression is that there is still time to short more, if you are up to it Jeffrey. Original Message From: Isin Sumengen-Ziel (DEUTSCHE BANK AG, LO) [mailto:sumeisilndb®bloomberg.net] Sent: Thursday, September 03, 2015 4:50 PM Subject: Faria: Brazil Daily Update Brazil's economic outlook deteriorates further According to newspaper Folha de S.Paulo, Finance Minister Joaquim Levy told President Dilma Rousseff on Wednesday that he was becoming increasingly isolated in the federal administration and losing support to implement his fiscal adjustment plan, and concluded that, under these circumstances, it would be difficult for him to stay in the government. Shortly afterward, Rousseff publicly defended Levy, claiming that he was not isolated in the government. As speculation about Levy's possible resignation continued on Thursday, the beleaguered Finance Minister cancelled a trip to Turkey (for the G-20 meetings) in order to have a meeting with Rousseff, Planning Minister Nelson Barbosa, and Chief of Staff Aloizio Mercadante. We expect Rousseff to repeat that Levy has her total support, and also to send to Congress an addendum to the 2016 federal budget reducing the projected deficit. Nevertheless, the reality is that Levy has lost a sequence of important fights in the government (especially the watering down of the fiscal measures, the change in the fiscal targets, and more recently the 2016 budget forecasting a federal primary deficit of 0.5% of GDP), and his position is becoming increasingly difficult day by day, as he remains under intense friendly fire (especially from the President's own party, the PT) and Rou