# Lula's Fiscal Policy Plan

> José Sérgio Gabrielli defends cutting interest rates without austerity for Lula's next government.
- Title: Lula's Fiscal Policy Plan · Poder360 | Shortify
- Summary: José Sérgio Gabrielli defends cutting interest rates without austerity for Lula's next government. José Sérgio Gabrielli argues for reducing Brazil's…
- Keywords: jose sergio gabrielli, lula, fiscal policy, interest rates, selic, dario durigan, petrobras, primary budget, bolsa familia, bpc, governo, Lula's
- Source: Poder360 — https://poder360.com.br/poder-integras/leia-a-integra-do-documento-sobre-politica-fiscal-de-lula
- Author: PODER360
- Published: 2026-11-02T22:14:16+00:00
- Read time: 2 min
- Topics: jose sergio gabrielli, lula, fiscal policy, interest rates, b3, selic, dario durigan, petrobras, primary budget, bolsa familia, bpc, governo
## New Fiscal Plan Published
José Sérgio Gabrielli released a fiscal policy plan for the end of 2026 and 2027.
## No Strong Correlation
Gabrielli claims there is no strong correlation between primary budget results and interest rates in Brazil.
## Interest Rate Strategy
Gabrielli supports reducing Selic to 7.5% annually before stabilizing at 3-5.5% over the next 4-5 years.
## Market Reaction
The market reacted negatively to Gabrielli's proposal for a new interest rate framework.
## Fiscal Policy Focus
Gabrielli emphasizes maintaining minimum wages, BPC, Bolsa Família, and public health education funding.
## Debt Concerns
Brazil's public debt reached 82.9% of GDP in September, with 11.2 percentage points increase since Lula's third term.
## Debt Liquidity
Gabrielli states 90% of Brazil's debt is in national currency with large foreign exchange reserves.
## Debt Liquidity
Gabrielli claims there is no reason for panic regarding Brazil's solvency with 69.3% of GDP in liquid debt.
## Debt Drivers
Gabrielli identifies external factors like the US-Iran war as the main drivers of inflation, not domestic demand.
## Market Reaction
The market reacted negatively to Gabrielli's proposal for a new interest rate framework.
## Election Impact
Gabrielli attributes the B3 drop after Lula's election victory to market surprise and portfolio reorganization.
## Fiscal Adjustments
Gabrielli supports fiscal adjustments without cutting minimum wages, BPC, Bolsa Família, or public health education funding.
## Key Measures
Gabrielli prioritizes reviewing inefficient tax benefits, analyzing public contracts, and recovering tax credits from large contributors.
## Economist Proposal
André Lara Resende's proposal for a CMN with fiscal and monetary policy targets for 4-5 years.
## CMN Details
The CMN would reduce Selic to 7.5% annually before stabilizing at 3-5.5% over the next 4-5 years.
## Market Response
The market reacted negatively to the CMN proposal, with the Finance Minister stating the government would not adopt a rate band.
## Key takeaway

José Sérgio Gabrielli argues for reducing Brazil's interest rates through fiscal adjustments without austerity, citing weak correlation between primary budget results and interest rates.