Brazil president shuffles Cabinet, combines ministries

Commenting on Rousseff’s performance, 82 percent of interviewees said her second term, starting in January, was worse than her first from 2011 to 2014.

Despite the government’s efforts to put the economy back on track and to rein in a political crisis, Brazilian President Dilma Rousseff’ s approval rating remained low. “We need political stability for Brazil to grow”.

The PMDB’s increased clout comes at the expense of her own Workers’ Party, known as the PT. Rousseff will fold secretariats representing social movements dear to her party such as equality and human rights into one ministry.

The administrative reforms and 10% pay cut for all ministers are created to show the government is sharing a little of the fiscal pain that has been imposed on voters in the form of cuts to healthcare and housing programs.

Opposition leaders said Rousseff’s cost cutting was a sham and she would continue to have trouble getting tax bills passed.

The PMDB increases its quota of ministries to seven, with the appointment of Marcelo Castro to the health brief, which has the largest ministerial budget and is seen as a powerful political bargaining chip. Rousseff needs the restive ally both to avoid impeachment and ram through austerity measures. Even with Friday’s shuffle, the party’s support may be short-lived, considering a convention next month at which the PMDB is expected to reconsider its relationship to the Worker’s Party. She made the pledge while speaking at a United Nations summit.

Earlier this month the government announced a $7bn (£4.5bn) package of spending cuts aimed at plugging the huge black hole in the country’s 2016 budget.

“We don’t know if the changes will really help the government to win more Congressional support, but it’s something”, said Alexandre Povoa, a money manager at Canepa Asset Management, which oversees 230 million reais of investments.

The cabinet announcement gave Brazilian stocks a boost but was shrugged off by currency investors, who said the real was gaining only because disappointing U.S. payroll numbers suggested the Federal Reserve may not be able to raise rates this year.