Relations between the U.S. and Brazil deteriorated after President Trump sought to halt criminal proceedings against his right-wing ally in the country, former leader Jair Bolsonaro, by imposing steep tariffs on Latin America’s biggest nation.

The Brazilian government secured 10.2 billion reais ($1.8 billion) in revenue from the first round of tax debt renegotiations with major companies this year, the Treasury's attorney general and the Federal Revenue Service said.

President Donald Trump announced Wednesday he planned to hit Brazil with a 50% tariff, in part because of the treatment of its former president Jair Bolsonaro, his political ally.

Brazilian assets face pressure from new US tariffs, but holding broad index trackers may reduce risk amid volatility. See why major Brazilian ETFs are a hold.

The U.S. will charge a 50% tariff on Brazilian goods starting on Aug. 1, President Trump announced in a letter to the Brazilian government on Tuesday—the highest level announced in his flurry of communiques to foreign leaders so far this week.

Brazilian President Lula da Silva vowed to retaliate if the US imposes tariffs, invoking Brazil's Economic Reciprocity Law. This followed Donald Trump's announcement of a 50% tariff on Brazilian imports,

Brazil believes it can withstand Trump’s 50 percent tariff, and aides to Lula say he is unlikely to shrink from a confrontation with the White House.