Brazil registers record public sector primary deficit in H1

Brazil posted a public sector primary deficit of 402.7 billion reals (about 77.1 billion U.S. dollars) in the first half of this year, compared to 5.7 billion reals (about 1.1 billion U.S. dollars) in the same period last year, the Central Bank of Brazil reported on Friday.

According to the report, it was the worst result for this period in history, and reflected an increase in expenditures as well as a drop in tax collection due to the novel coronavirus pandemic.

In June of this year, the public sector deficit, excluding interest payments, amounted to 188.7 billion reals (about 36.3 billion U.S. dollars), a record for the month.

Interest payments on public debt rose to 21.5 billion reals (about 4.1 billion U.S. dollars) in June, compared to 17.4 billion reals (about 3.3 billion U.S. dollars) in the same month in 2019. In the last 12 months, interest payments reached 359.8 billion reals (about 69.2 billion U.S. dollars), around 5 percent of Brazil’s GDP.