Brazil lawmakers approve spending cap in victory for Temer

[WorldNews]

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By Maria Carolina Marcello BRASILIA (Reuters) - A congressional committee in Brazil approved a constitutional amendment on Thursday that would limit public spending increases for 20 years, handing President Michel Temer an initial victory in his plan to plug a widening deficit. The unprecedented amendment, which limits the growth of federal spending to the rate of inflation, is aimed at gradually closing a yawning budget gap that topped 10 percent of gross domestic product (GDP) last year. It is the first of a series of austerity measures to assuage market concerns that the once-booming economy, which was stripped of its investment grade rating last year, could be hurtling towards a debt crisis.

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