Brazil eyes creation of privatization fund not subject to fiscal rules -govt source

Brazil's government is drawing up a constitutional amendment to create a fund from privatizations and state asset sales to pay down debt, meet court-ordered payment obligations and help the country's poorest people, a government source said on Wednesday. Crucially, from a fiscal perspective, the fund will not be subject to the 'spending cap', the government's most important fiscal rule which limits growth in public spending to the previous year's rate of inflation.

According to the source, the Economy Ministry has already drawn up the amendment, and could submit it to Congress as early as this Wednesday.

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