Brazil gross debt rises to 82.9% of GDP in August as interest expenses surge
EWZ•Brazil's gross debt rose 0.3 percentage point from July to 82.9% of GDP in August, near analysts' 83.0% forecast. The primary deficit was 10 billion reais, while the nominal deficit widened to 116 billion reais as interest expenses reached 105.9 billion reais.
1. Debt ratio climbs
Brazil's gross debt rose to 82.9% of GDP in August, extending an upward trend driven largely by interest costs. The ratio increased 0.3 percentage point from July, broadly in line with analysts' 83.0% forecast.
2. Deficits and interest costs
Gross debt has risen 4.2 percentage points of GDP so far this year, with interest payments accounting for most of the increase. The public sector posted a primary deficit of 10 billion reais in August, narrower than the 15.7 billion reais forecast, while the nominal deficit widened to 116 billion reais, above the 110.15 billion reais forecast. Interest expenses totaled 105.9 billion reais.
3. Swap operation effects
The central bank said interest costs were affected by foreign exchange swap operations, which generated a loss of 9.3 billion reais in August, compared with a gain of 19.9 billion reais in the same month last year.
