Marcelo Ruiz Rodrigues dos Santos
Adapting to a new scenario of diminished domestic interest rates, Brazil’s National Monetary Council has raised limits for pension fund investment in equities to 70% from 50% previously. The strategy would allow for an additional R$ 90 billion in pension fund investments in stocks.
Brazilian private pension funds currently administer R$450 billion in total assets. Brazil’s Central Bank has cut the country’s reference Selic interest rate by five percentage points this year to an all-time low of 8.75% annually.
In addition to increasing overall investment limits, the government would begin to allow managers to invest up to 10% of their resources in overseas funds. Previously, such investments were prohibited.
