<table><tr><th>From:</th><th>Daniel Sabba</th></tr><tr><td>Sent:</td><td>Wednesday, April 1, 2015 11A0 PM</td></tr><tr><td>To:</td><td>Jeffrey Epstein</td></tr><tr><td>Cc:</td><td>Vahe Stepanian; Ariane Dwyer</td></tr><tr><td>Subject:</td><td>FW: Faria: Brazil: Latest on Levy, fiscal, Petro</td></tr></table>

From: 'sin Sumengen-Ziel (DEUTSCHE BANK AG, LO) Sent: Wednesday, April 01, 2015 7:50 AM

To: Daniel Sabba

Subject: Faria: Brazil: Latest on Levy, fiscal, Petro

- Finance Minister Joaquim Levy spoke for more than 7 hours at the Senate E=onomic Committee yesterday, explaining the importance and urgency of his f=scal adjustment plan. In the end, he obtained a small victory, as the Sena=e postponed the vote on the bill that gives the federal government 30 days=to execute another measure restructuring the debts of states and municipal=ties. Levy has proposed to delay the debt restructuring until 2016 and the= compensate the local government for what they will pay in excess in 2015.=This is basically kicking the can down the road, but, as we commented yest=rday, given the hostile political environment, this is probably the best d=al that Levy can get at this moment.

- Newspaper Folha de S.Paulo today claims that the federal government's "=ontingenciamento" (budget cuts) could total as much as BRL80bn. It makes s=nse: given the poor fiscal results obtained so far this year and the diffi=ulty in passing some of the measures in Congress, the government will inev=tably have to cut a lot, and the cuts will be heavily concentrated in publ=c investments. In an interview to Bloomberg News, President Dilma Rousseff=said that she will do everything she can to meet the primary surplus Large= of 1.2% of GDP.

- There has been a lot of talk in the local press lately claiming that Petr=bras will definitely manage to publish its audited results by the end of A=ril. Nevertheless, Agencia Estado today reports again that, because ther= remains a risk that the company may fail to publish its results by the en= of the month (they mention uncertainty related to the auditing process), =t is negotiating a waiver with its largest creditors in order to avoid a t=chnical default.

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