Brazil Slowdown Hits Operators

All Brazil's mobile operators reported a fall in profits in Q212, as pressures from regulators and problems in the general economy are felt. BMI believes the problems will continue to grow in H212, as imbalances in the Brazilian economy begin to unwind and consumer spending is impacted. Concurrently, the increasing pressure from regulators to invest more will cause problems, particularly for Vivo and TIM, which are both subsidiaries of European firms with large debt burdens.

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