Demonstrators protest against Brazilian President Michel Temer in Sao Paulo, Brazil. Photo: AFP

Citibank analysts warn of prolonged uncertainty in Brazil: “With the Temer recording being seen as inconclusive and Temer expressing his willingness to fight on, there won’t be a quick resolution. The market may therefore give up on pension reform before the 2018 election. This creates rising risks with respect to the fiscal dynamics and requires a higher risk premium at the back end of the curve and in the currency. “