Halister News

(Bloomberg) -- Odds of Brazil President Michel Temer falling rose to 70% from 20%, despite growing doubts over the evidence implicating him, Eurasia’s Joao Augusto de Castro Neves, Christopher Garman, Filipe Gruppelli Carvalho and Djania Savoldi write in report.

• Previous odds was based on fact that presidents can’t be held accountable for wrongdoings before their terms and underestimated “the carelessness of the current government for acts committed during its term”
• Strategy to discredit Joesley Batista and challenge the existing evidence may buy Temer some time, but sum of allegations still can’t be explained
• Conditions for Temer to cling on to power are increasingly precarious, political momentum should continue to build against him in Congress, courts, and in the streets
  • Temer to have a “very hard time cobbling together a coalition to approve reforms”
• Whether Temer’s fall will be swift or protracted will be critical for the reform outlook
  • Best outcome for reforms would be if Temer is ousted by the Electoral Court during trial of Rousseff-Temer ticket in 2014
• Temer can survive the turmoil if evidence remain inconclusive and Supreme Court accepts his petition to dismiss investigations
  • Should Temer survive (30% odds), “he is likely to approve only a very watered down version of pension reform”