Brazil's Bolsonaro urges lower house to block public sector pay rise

SAO PAULO (Reuters) – Brazil’s far-right President Jair Bolsonaro on Thursday urged the country’s lower house to bar a public sector pay rise in a vote session scheduled for later in the day.

On Wednesday, the Senate decided to overturn a presidential veto blocking higher spending with civil servants’ salaries, in a move that could increase public expenditure in billions of reais.

“I cannot govern this country if the lower house keeps the decision to overturn the veto. It would be impossible to govern Brazil,” Bolsonaro said outside the Alvorada Palace, the president’s official residence, estimating a loss of 120 billion reais ($21.17 billion) for the country.

Bolsonaro decided to veto the pay rises in return for disbursing 60 billion reais of aid to states and local authorities.

Economy Minister Paulo Guedes called the Senate decision a “disaster” and a “crime” against the population on Wednesday.

Amid fiscal concerns, the Brazilian real continued a downward trend against the U.S. dollar in morning trade, weakening roughly 2%. The stock exchange index was down 0.8%.

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