Brazil has shot from global pariah among investors to emerging market favourite in less than 12 months — and many analysts believe Latin America’s biggest economy could be set for further gains.

Brazil’s real has already strengthened nearly 23 per cent against the dollar this year while the benchmark equities index Ibovespa has gained nearly 41 per cent on the impeachment in August of former leftist president Dilma Rousseff for budgetary violations.

But analysts say further upside is likely as the new market-friendly government of President Michel Temer, Ms Rousseff’s replacement, pushes ahead with promised economic reforms.

Congress is expected to begin voting this week on the first of these changes, a constitutional amendment that would limit real increases in budget spending to zero for up to 20 years. This would help ensure Brazil’s public finances recover from a blowout under Ms Rousseff.

“The momentum is very strong and they [the new government] are delivering on what they have promised,” said Alejo Czerwonko, emerging market equity strategist at UBS Wealth Management.