(Bloomberg) -- Brazilian assets tanked after a call with a member of the government’s economic team failed to ease lingering concerns about the country’s debt trajectory.
The real extended losses in the afternoon, falling as much as 1.4% to lead losses in a basket of 23 emerging-market currencies tracked by Bloomberg. Swap rates surged, with contracts maturing in January of 2029 soaring more than 40 basis points while similar contracts in Mexico and Chile declined.
Guilherme Mello, Brazil’s economic policy secretary, doubled down on the government’s fiscal plan in a call with investors, according to people who attended. Mello reiterated that measures introduced by Luiz Inacio Lula da Silva’s administration are robust enough to sustain the country’s so-called fiscal framework, the people said, asking not to be named because discussions are private.
The Finance Ministry confirmed Mello spoke to investors on Friday.
The real hit an all-time low last week after the government’s spending-cut package underwhelmed traders, and is down 20% this year.
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