This year’s plunge in Brazilian stocks is set to resume as investors lose hope that an impeachment of President Dilma Rousseff will lead to a quick economic turnaround and Goldman Sachs warns the country could be headed into a depression. She has denied any wrongdoing.
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The Supreme Court approved an appeal from the Communist Party of Brazil (PCdoB), which is allied to the leftist Workers’ Party of Rousseff, over alleged irregularities in the composition of the committee, apparently made up by legislators representing all parties.
Justice Luiz Edson Fachin decided late on Tuesday to suspend the appointment of an impeachment committee and all its proceedings until the top court can meet on December 16 to decide on the constitutional issue, the official said.
Opponents who initiated the impeachment bid against Rousseff accuse her of breaking budget rules to boost spending during her re-election campaign previous year.
Cunha, from the PMDB’s openly anti-Rousseff wing, is the architect of the impeachment drive and also oversaw the controversial session Tuesday to form the commission.
The house ethics committee was due to vote on Wednesday on whether to investigate Cunha for lying about Swiss bank accounts, which could cost him his seat, but his backers delayed a decision with an injunction removing the committee’s rapporteur.
According to Congresso em Foco, a prominent Brasilia watchdog group, a third of the lawmakers named on the committee are under investigation by the Supreme Court for corruption, money laundering, electoral fraud and other crimes.
The commission will eventually vote to decide if the impeachment proceedings should go to the full house for a vote. A list compiled by opposition and dissidents of parties of the majority – such as the centrist Brazilian Democratic Movement (PMDB) headed by Vice-president Michel Temer – obtained 272 nominations, in respect to 199 of those promoted by government allies, resulting in a majority hostile to Rousseff of 39 on a total of 65 legislators. If Rousseff is forced from office, Temer would become interim president.
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The ruling was a reprieve for Rousseff because a court decision could favor her situation by curbing the power of her nemesis, lower house speaker Eduardo Cunha.
