Market reduces projections for public debt in 2025 and 2026, shows Prisma
The May Fiscal Prisma report, released by the Ministry of Finance, showed that economists have slightly reduced projections for Brazil's gross public debt in 2025 and 2026. It is now expected that the debt will reach 80.30% of GDP in 2025 (down from 80.50%) and 84.49% in 2026 (down from 84.55%).
Despite this timid improvement in debt, expectations for the primary result remain negative and far from government targets. The forecast for 2025 indicates a deficit of R$ 72.6 billion and, for 2026, a deficit of R$ 80.6 billion — far from the goal of zero deficit in 2025 and a surplus of 0.25% of GDP in 2026.
The market remains skeptical about the government's ability to meet the new fiscal framework, especially with the increase in spending expected for 2026, an election year, and the rise in interest rates, which pressures the cost of debt. Finance Minister Fernando Haddad announced that targeted measures are being prepared to try to maintain the goals, while the projected revenue showed a slight increase.
With the deficit growing, debt rising, and elections approaching, the only goal that seems truly feasible is to increase popularity — even if it is with “targeted” measures, of course.
Source: CNN Brasil