Brazil’s Supreme Court on Thursday authorized an investigation into President Michel Temer and allegations that he condoned bribery of a potential witness in the massive “Car Wash” graft probe.
Temer denied any wrongdoing and strongly resisted growing calls for him to resign.
The news sent Brazilian stock and currency markets tumbling and raised doubts that Congress would pass Temer’s austerity measures.
Temer’s situation grew far more perilous after the Supreme Court officially approved an investigation into allegations against him, according to a source with direct knowledge of the decision.
Also, a top court justice approved plea-bargain testimony and an audio recording that allegedly captured him conspiring to obstruct justice with Joesley Batista, chairman of meat company JBS SA. The approval allows the court to quickly make both the testimony and audio public.
Leaders of Temer’s top allied party in Congress, the PSDB, said that if the allegations proved true, they would demand that three of their members who are in the president’s cabinet resign.