By Stocksak, Brazil’s public debt falls for the third consecutive month in September

© Stocksak. FILE PHOTO – A homeless man walks near the Ministry of the Economy in Brasilia, Brazil, March 23, 2022. REUTERS/Ueslei Marcelino

BRASILIA – Official data from Brazil showed that Brazil’s federal public debt declined for the third consecutive month in September. Official data also showed Wednesday that the government’s liquidity reserves were being reduced by the net redemptions of bonds.

According to the Treasury, bond redemptions outnumbered issuances by 76.4 million reais ($14.29 trillion). At the same moment, interest payments on public debt reached 47.2 million reais.

The stock of federal public debt fell 29.4 billion reais to 5.752 trillion in August.

The Treasury’s liquidity reserve which allows it greater freedom in managing debt amid market volatility, fell 10% to 1.031 trillion Riais, the lowest level since Oct 2021.

According to Treasury, the Treasury believes that the volume is sufficient in order to guarantee payments for 9.55 months of bond maturities.

Inflation-linked bonds have seen their yields drop in Brazil. The average interest rate on domestic federal debt fell to 11.7% in September after an August of 11.9%.

Brazil’s consumer prices fell for the third consecutive month in September. This was due to major tax cuts on fuels and electricity, ahead of the Oct. 30 presidential election.

($1 = 5.3458 reais)

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