Lula says Brazil will 'grow with responsibility' as markets recover

Brazil's leftist President Luiz Inacio Lula da Silva said on Friday it was possible for the country to grow with responsibility, trying to calm market jitters about the potential for rampant social spending under his watch.

Brazil's leftist President Luiz Inacio Lula da Silva said on Friday it was possible for the country to grow with responsibility, trying to calm market jitters about the potential for rampant social spending under his watch. Lula's comments came as he kicked off his first cabinet meeting in Brasilia aiming to instill discipline among the newly formed team after various communication hiccups drove Brazil's currency and stock index down 3.8% and 5%, respectively, in his first days in office.

"It is possible for us to grow again with responsibility and income distribution," said Lula, who assumed office on Jan 1. On Friday, the Brazilian real was up roughly 1.2% against the dollar, while the Bovespa rose 1.4%. They had already pared some losses in the previous two sessions.

Lula wanted to dispel fears of a more interventionist stance in the economy. He also echoed comments from Planning Minister Simone Tebet, a centrist former senator who said a day earlier the government would have multiple lines of thoughts on the economic agenda. "We are not a single-minded government, with a single philosophy," Lula said.

Analysts said Tebet's remarks helped boost markets. Also helping investor sentiment were comments from Lula's chief of staff, who said the government was not considering any plans to revise economic reforms, and the incoming CEO of Petrobras who ruled out interventions in fuel prices.

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