Brasília – Brazil’s federal, state and local governments and state-run companies ran a BRL 13.008 billion primary deficit last month, the Brazilian Central Bank reported this Friday (28). The May 2018 result had been a narrower BRL 8.224 billion deficit. Primary deficit numbers are calculated by subtracting expenses from revenues, with debt interest spending not factored in.
Central Bank Statistics Department chief Fernando Rocha said the May 2018 result was better because BRL 3.5 billion from the Sovereign Fund made extinct that month were returned to government coffers. “That hasn’t been the case this last May, hence the wider deficit,” he explained.
Year-to-date through May saw a BRL 6.966 billion primary surplus in Brazil, up from a BRL 933 million deficit in the comparable year-ago period. This is the best result for the timeframe since a BRL 25.5 billion deficit through May 2015.
Rocha ascribed the improved year-to-date result to a stricter rein on public spending across all spheres of government. Regional (state and local) governments ran a combined BRL 19.132 billion surplus through May, up from BRL 12.861 billion a year ago.
The primary deficit target for this year is BRL 132 billion. The 12 months through May saw a BRL 100.359 billion deficit – tantamount to 1.44% of GDP – fueled by last May’s numbers.
Translated by Gabriel Pomerancblum
