Brazil's Levy has not resigned, to stay on as finance minister (updated)

Valecha Engineering

17/10/2015 24:40

(Adds presidential aide's comment) 
    By Alonso Soto and Marcela Ayres 
    SAO PAULO/BRASILIA, Oct 16 (Reuters) - Finance Minister 
Joaquim Levy has not resigned and will stay in his post, 
Brazil's government said on Friday, denying a media report that 
he planned to step down in a dispute over austerity measures. 
    A finance ministry spokeswoman told reporters that Levy 
"continues to work and is committed to improve the country's 
future." 
    News magazine Veja magazine earlier reported that Levy was 
going to quit, frustrated by opposition to austerity policies 
that he has designed to shore up Brazil's public finances. 
    The report hit Brazil's real currency  BRL=  and US-traded 
shares of Brazilian companies.  
    Veja later said in a separate report that Levy was going to 
stay on. 
    Levy, who took over the finance ministry in January, has 
struggled to push austerity proposals through Brazil's Congress 
and faced some opposition inside Rousseff's cabinet team. 
    In an interview with Reuters on Saturday, Levy said he had  
Rousseff's support and planned to stay in the job as long as 
necessary to pull the economy out of its slump.  urn:newsml:reuters.com:*:nL1N12B00V 
    But a senior lawmaker who spoke with Levy earlier on Friday 
said the finance minister was upset over media reports that 
Rousseff's mentor and predecessor as president, Luiz Inacio Lula 
da Silva, was calling for his removal over his aggressive drive 
to cut spending and raise taxes. 
    The lawmaker, who declined to be named to speak freely, said 
they did not discuss a possible resignation.  
    Levy did not mention his discontent or any desire to quit 
when he met with Rousseff and two other ministers on Friday 
afternoon to discuss Brazil's 2015 and 2016 fiscal performance 
and goals, a presidential aide told Reuters.   
    The report of Levy's plan to resign hit Brazilian asset 
prices. After the closing bell, the iShares MSCI Brazil ETF 
 EWZ.P  fell 1.4 percent to $23.40. The U.S.-traded shares of 
Brazilian mining giant Vale  VALE.N  lost 1.9 percent to $4.70 
and state-run oil firm Petrobras  PBR.N  fell 2 percent to 
$4.98. 
    Speculation over whether Levy would stay or go has swirled 
over the past few months as Brazil's economy fell into recession 
and Congress blocked some of the austerity measures he has 
proposed. 
    Levy has come under fire from lawmakers from Rousseff's own 
Workers' Party, who complain that the austerity drive is further 
sinking the economy into recession and hurting the poor. 
    Concerned by the deepening economic and political crisis, 
Standard & Poor's last month downgraded Brazil's credit rating 
to junk grade and Fitch Ratings this week cut its own Brazil 
rating to the brink of junk.  urn:newsml:reuters.com:*:nL1N12F16M 
 
 (Reporting by Marcela Ayres; Writing by Alonso Soto; Editing by 
Kieran Murray, Bernard Orr and Diane Craft) 
 ((alonso.soto@thomsonreuters.com; +55-11-5644-7714; 
+55-119-8346-7153; Reuters Messaging: 
alonso.soto.thomsonreuters.com@reuters.net)) 
 
Keywords: BRAZIL FINMIN/