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BRASILIA, March 31 (Reuters) – Brazil’s national debt rose to a new all-time high of 90% of GDP in February, central bank figures showed on Wednesday, as a rise in net borrowing and nominal interest payments in the month outpaced broader economic growth.
Debt rose to 90% of gross domestic product in February, up 0.6 percentage point from the previous month, while net debt edged up to 61.6% of GDP from a downwardly-revised 61.4% the month before.
Worries over Brazil’s perilous finances heightened this week after a respected independent watchdog said the government was on course to break its key fiscal rule this year and the Treasury said the mandatory spending estimates in the 2021 federal budget approved by Congress were too low.
The public sector registered a deficit in February excluding interest payments of 11.8 billion reais ($2 billion), the central bank said, around half the 23.95 billion reais shortfall forecast in a Reuters poll of economists.
The primary deficit in the 12 months through February was 691.7 billion reais, or 9.2% of GDP, down from 9.4% of GDP in the 12 months through January, the central bank said.
The nominal deficit including interest payments was 1.01 trillion reais, or 13.45% of GDP, the central bank said, compared with 1.02 trillion reais or 13.6% of GDP the month before.
While debt and borrowing rose, record low interest rates meant public sector interest payments were anchored at a series low of 4.22% of GDP, down from 5.12% of GDP a year earlier.
In nominal terms, interest payments in the year to February fell to 316.5 billion reais from 382 billion, the central bank said. February was the last full month before official interest rates were raised for the first time in almost six years.
$1 = 5.75 reais Reporting by Jamie McGeever. Editing by Andrew Heavens and Mark Potter
