• 

  45%+0.2%

  Denial Calms Markets

  Fernando Haddad’s denial is broadly accepted as the Finance Ministry’s operative position, reducing fears of direct political interference in Banco Central do Brasil policy. Investors still expect Lula to criticize high rates, but not to pursue a formal legal cap on the Selic.

  Finance +0.4% · Non-Energy Materials +0.3%

• 

  25%+0.2%

  Fiscal Route Chosen

  The government shifts the debate from monetary interference to fiscal consolidation, arguing that spending discipline is the path to lower rates. This outcome is plausible because Brazil’s prior currency stress and high-rate debate both increase the incentive for a credibility package.

  Energy +0.4% · Finance +0.3% · Non-Energy Materials +0.3%

• 

  20%−1.2%

  Pressure Returns

  Even if Haddad denies an official plan, political allies of Lula continue pushing for ways to force lower borrowing costs. This creates recurring uncertainty over Banco Central independence and keeps the Selic debate alive.

  Finance −2.1% · Non-Energy Materials −0.8% · Energy −0.7%

• 

  10%−0.9%

  Intervention Shock

  A low-probability but high-impact path sees the presidential palace advance a direct intervention despite the Finance Ministry’s denial. This would represent a material challenge to central-bank credibility and would likely trigger a sharper selloff in Brazil-sensitive assets.

  Finance −1.6% · Non-Energy Materials −1.0% · Energy −0.9%

Each figure is the modeled move of the S&P 500 if it happens. For information only. Not investment advice.