President Luiz Inácio Lula da Silva has received a spreadsheet of economic measures from his government’s economic team, aimed at rationalising public spending and combating privileges such as supersalaries. He will decide only at the end of November, after consulting economists. A first round of consultations is scheduled for Thursday 5 November 2026. Lula has ruled out fiscal tightening.
Measures under study
Among the options being examined is ending the income tax exemption for LCI and LCA bonds held by individuals. The team also wants to tackle supersalaries across the Executive, the Judiciary and the Legislature. Military pensions have returned to the discussion, although the matter is not new.
The government sent a bill to Congress in 2024 that would set a minimum retirement age of 55 for military personnel. Under current rules, military personnel can transfer to the reserve after 35 years of contributions. That bill remains stalled in the Câmara dos Deputados.
Signals to markets and the calendar ahead
Lula has held near-daily talks with Finance Minister Dario Durigan and Planning Minister Bruno Moretti since winning the election in October. A member of the economic team said the president will not change the course of economic policy. The aim, he said, is to signal a reduction of public debt and of the basic interest rate.
Durigan said the government must create conditions for a sustainable, structural reduction of interest rates. He also admitted that the 2027 budget needs adjustments. No concrete measures are to be announced in the national address on 8 November. Lula leaves for Turkey on 9 November for COP31 in Antalya, and the ASEAN summit opens in the Philippines on 15 November.
