Category: Macroeconomy/Finance

Information regarding Brazil’s finance sector and the country’s macroeconomy.

Private banks will have a 70% loan of up to $3.1 bn to help energy distributors in Brazil

Private banks will have 70% of the so-called “Conta-Covid”, a financing package of up to R$16.4 billion ($3.1 bn) made possible with government support to help the energy distributors’ cash during the pandemic. The National Bank for Economic and Social Development (BNDES) and public banks will enter with about R$5 billion ($944 mm) in the operation, which ended up with costs higher than expected by the sector.

Brazilian trade balance has a surplus of $7.46 bn

Commercial balance is the largest for the months of June of the entire historical series, which began in 1989. The trade balance registered a surplus of $ 7.463 bn in June, the Ministry of Economy reported. Compared to June last year, there was a 38.8% increase in the balance. In the first semester, the government reported a positive balance of $ 23.035 bn, 10.3% less than in the same period of 2019.

Inflation at Brazilian plants outflow rises to 1.22%

The Producer Price Index (PPI), which measures inflation at the output of factories, stood at 1.22% in May this year. The rate is higher than the 0.11% registered in April. The PPI has accumulated inflation of 3.37% for the year and 4.60% over 12 months. Among the four major industry categories, the highest inflation was observed among capital goods 3.08%.

Brazilian public sector accounts hold deficit of $24 bn

The consolidated public sector accounts, which include the federal government, states, municipalities and state-owned companies, recorded a primary deficit of R$131.4 billion ($24 bn) in May, according to the Central Bank. The deficit means that public sector expenses exceeded revenues from taxes and contributions.

Energy sector funds $934 mm in infrastructure debentures

The energy sector was responsible for 7 of the 12 debenture issues stimulated between January and May of this year, according to the latest issue of the Ministry of Economy’s newsletter. The volume of funds involved in these operations reached R$4.95 billion, ($934 mm) according to the publication released.

Central Bank reports obtained loans reach $55 mm in May

The Central Bank of Brazil reported that companies and families obtained loans of R$289 billion ($55 mm) from banks in May. There was a reduction of 3.3% in relation to April. In the accumulated result for the year, total concessions grew by 7.6%, compared to the period in 2019, reflecting the increase in corporations (17.7%) and the decrease in individuals (0.9%). The Central Bank of Brazil said when it released the Monetary and Credit Statistics.

BNDES announces another $940 mm for SME’s

BNDES will expand the credit line for working capital by R$5 billion ($940 mm) for micro, small and medium-sized companies to face the economic effects of the COVID-19 pandemic. According to the bank, the first R$5 billion ($940 mm) credit launched at the beginning of the pandemic has run out.

Central Bank projects 6.4% drop in Brazil’s GDP

The Central Bank maintained its inflation estimate for 2020 in the reference scenario, which uses constant exchange and interest rates for the projection horizon. Accordingly, it revised the GDP projection for a 6.4% drop this year. The change in the projection is essentially associated with the advancement and duration of the pandemic in all national territory.

Brazil economy could fall 7%, deficit top 11% of GDP

Brazil’s economic growth and fiscal outlook this year are shaping up to be worse than official government forecasts, making a return to austerity and reforms next year all the more pressing, said Treasury Secretary Mansueto Almeida. He added that the public sector primary deficit this year excluding interest payments could reach R$800 billion ($152 billion), or more than 11% of gross domestic product, while the economy is set to shrink around 6-7%.

Federal Public Debt rises to $800 bn

The cooling of the turbulence caused by the new coronavirus pandemic and the low salaries made the government’s debt rise for the first time in two months. The Federal Public Debt (DPF), which includes the federal government’s internal and external indebtedness, rose 2.17% in nominal terms in May compared to April. The stock rose to R$ 4.251 trillion ($ 800 bn).