Brazil’s gross debt-to-GDP ratio fell to 75.3% in January, below market expectations. The reduction of 0.8 percentage points resulted from net debt redemptions and nominal GDP growth. A primary surplus of 104.096 billion reais was reported, slightly above forecasts, with the government targeting a zero primary deficit for the year.
In January, Brazil’s public sector gross debt-to-GDP ratio decreased unexpectedly to 75.3%, down from 76.1% in December. This figure was notably below the anticipated 76.2% according to a Reuters poll of economists. The decline of 0.8 percentage points was chiefly attributed to net debt repayments and the enhancement of nominal GDP.
For the month of January, Brazil’s public sector reported a primary surplus of 104.096 billion reais ($17.92 billion), slightly exceeding the 102.135 billion reais forecasted by analysts. This performance contributed to a 12-month rolling deficit of 0.38% of GDP. Over the past year, the central government recorded a deficit of 0.37% of GDP until January.
President Luiz Inacio Lula da Silva’s administration aims to achieve a zero primary deficit this year, setting a tolerance of 0.25% of GDP in either direction. The exchange rate was reported at $1 equaling 5.8089 reais.
In summary, Brazil’s public sector has successfully reduced its gross debt-to-GDP ratio to 75.3% as of January, surprising market expectations. This reduction, alongside a primary surplus that exceeded projections, indicates positive indicators for fiscal health. The government’s target for a zero primary deficit reflects an ambitious fiscal policy under President Lula da Silva’s administration, with ongoing efforts to stabilize the economy.
Original Source: www.tradingview.com
