Brazil’s central government posted an 84.9 billion reais budget surplus in January, below the expected 88.5 billion reais. The surplus is an improvement from January 2022’s 79.5 billion reais. Government spending rose by 4.4%, surpassing net revenue growth of 3.7%. Over the last year, a primary deficit of 42.2 billion reais was recorded, as the government aims to balance the budget.
In January, Brazil’s central government recorded a primary budget surplus of 84.9 billion reais ($14.6 billion), a figure that fell short of the 88.5 billion reais anticipated by analysts. Treasury data indicated that the growth in inflation-adjusted government spending at 4.4% outpaced the 3.7% increase in net revenues compared to the previous year. Despite being slightly below expectations, this surplus represents an improvement from the 79.5 billion reais surplus experienced in January 2022.
Over the preceding twelve months, the central government reported a primary deficit of 42.2 billion reais, reflecting 0.32% of the nation’s gross domestic product (GDP). The government’s official target for the fiscal year is to achieve a balanced budget, allowing some flexibility for a deficit of up to 31 billion reais within a tolerance of 0.25% of GDP. These fiscal outcomes suggest ongoing challenges in aligning revenue growth with governmental expenditure in the face of inflationary pressures.
In summary, Brazil’s January primary budget surplus, while below market forecasts, signifies an improvement from the prior year. Nevertheless, rising expenditures continue to present challenges against revenue increases, necessitating careful fiscal management as the government aims for a balanced budget this year.
Original Source: www.marketscreener.com
