Economic Information

PRESS RELEASE - February 24, 2017

Fiscal Policy
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I - Fiscal results

The consolidated public sector registered a primary surplus of R$36.7 billion in January. The Central Government and the regional governments posted respective surpluses of R$26.3 billion and R$10.8 billion, while the state-owned companies turned in a deficit of R$384 million. When compared with January 2016, there were increases of R$5.4 billion in the Central Government's surplus and R$2.8 billion in the regional Governments' surplus, as opposed to a decrease of R$578 million in the state-owned companies' deficit.

Over the twelve month period, the cumulative primary result of the consolidated public sector reached a deficit of R$147 billion (2.33% of GDP), compared with a deficit of R$155.8 billion (2.48% of GDP) in December 2016.

Nominal interests of the consolidated public sector appropriated on an accrual basis reached R$36.4 billion in January, compared with R$34.5 billion in December. In the 12-month period up to January, nominal interests reached R$387.2 billion (6.13% of GDP), falling by 0.34 p.p. of GDP in comparison with the value accumulated up to December.

The nominal result of the consolidated public sector, which includes the primary result and nominal interests appropriated on an accrual basis, posted a surplus of R$299 million in January. In the year, the nominal deficit totaled R$534.2 billion (8.46% of GDP), compared with a deficit of R$562.8 billion (8.95% of GDP) observed in December 2016.

The nominal surplus registered in the month was consequent upon decreases of R$31.7 billion in the net bank debt, R$9.7 billion in the net external financing and R$7.7 billion in other domestic financing sources, including the monetary base, partially offset by an increase of R$48.8 billion in the securities debt.


II - Federal securities debt

The domestic federal securities debt, outside the Central Bank, evaluated by the portfolio position, totaled R$2,938.6 billion (46.6% of GDP) in January, falling by R$47.9 billion compared with the previous month. This result reflected net redemptions of R$78.4 billion, a decline of R$0.6 billion due to the exchange rate appreciation, and incorporation of interests of R$31.1 billion.

Items worth highlighting were net redemptions of R$78.5 billion in NTN-F; R$27.2 billion in LTN and R$2.7 billion in NTN-C; and net issuances of R$17.3 billion in LFT; R$12.5 billion in NTN-B and R$0.5 billion in CFT-E.

The participation by indexing factors registered the following evolution in relation to December 2016: the percentage of exchange-indexed securities remained stable at 0.4%; Selic-indexed securities rose from 21.6% to 22% due to net issuances of LFT; fixed-rate securities fell from 27.4% to 24.8%, due to net redemptions of LTN and NTN-F; and inflation-indexed securities rose from 24.7% to 24.9%, due to net issuances of NTN-B. The participation of repo operations increased from 25.6% to 27.6%, showing net sales of R$86.9 billion.

In January, the maturity structure of the securities debt on the market was as follows: R$300.3 billion, 10.2% of the total, maturing in 2017; R$437.3 billion, 14.9% of the total, maturing in 2018; and R$2,201 billion, 74.9% of the total, maturing as of January 2019.

At the end of January, the total net exposure in exchange swap operations reached R$83.3 billion. The result of these operations in the period (difference between the yield of the Interbank Deposit and the exchange variation plus coupon) was favorable to the Central Bank by R$5.1 billion.


III - Public Sector Net Debt (PSND) and General Government Gross Debt (GGGD)

The PSND reached R$2,927.6 billion (46.4% of GDP) in January, growing by 0.4 p.p. of GDP compared with the previous month.

In the year, the increase in the PSND/GDP ratio was due to incorporation of nominal interests (+0.6 p.p.), exchange rate appreciation of 4.1% in the month (+0.6 p.p. of GDP), the primary surplus (-0.6 p.p.), the parity adjustment of the basket of currencies that compose the net external debt (-0.1 p.p.). and the effect of nominal GDP growth (-0.2 p.p.).

The GGGD (Federal Government, INSS, state and municipal governments) reached R$4,399 billion in January (69.7% of GDP), remaining practically stable, as a proportion of GDP, when compared with the previous month.