(Adds quotes, background) BRASILIA, April 5 (Reuters) - Brazilian Economy Minister Paulo Guedes said on Monday he expected the impasse surrounding this year’s federal budget to be resolved “well before” the official April 22 deadline, and dismissed the recent controversy surrounding it as noise. The 1.5 trillion reais ($264 billion) budget was approved by Congress last month but not signed off on by President Jair Bolsonaro. It is now being revised after it emerged it could break one of the government’s key fiscal rules. The Independent Fiscal Institute watchdog said last week the “spending ceiling” could be exceeded by 31.9 billion reais, and the Treasury said the budget needed to incorporate a more “realistic” level of spending. Guedes played down the issue, which has helped keep the exchange rate weak and market-based interest rates and spreads high, insisting that talks with lawmakers are constructive and collegial. “We have the formal deadline of April 22, but it (a resolution) should be well before that, thanks to the will of everyone involved,” Guedes told an online event hosted by XP Investimentos and InfoMoney. “There is no fight. There is a conversation to correct any mistakes. Everyone is united,” he said, adding the 5,000-page budget had to be economically right, legally sound and politically satisfactory. Guedes also said that any decline in economic activity due to the deadly second wave of the COVID-19 pandemic sweeping the country would be smaller and shorter than last year’s fall. He added that he hoped Brazil would have reached the “critical point” of herd immunity to the virus within three or four months, allowing people to get back to work and the economy to pick up again. Guedes highlighted record tax collection and formal job growth figures in January and February. But the economy has shown clear signs of slowing and likely shrank in the first quarter. Many economists have cut their 2021 forecasts. (Reporting by Jamie McGeever and Gabriel Ponte; Editing by Peter Cooney)