Brazil faces significant fiscal risks and rising public debt

Brazil is confronting a critical fiscal situation characterized by rising public debt and high deficits. Recent data indicates that the Gross General Government Debt (DBGG) has increased significantly, reaching 82.51% of GDP, up from 71.38% in January 2023. This represents an increase of R$ 3.7 trillion in debt over that period.

Economic indicators show a primary deficit of 0.67% and a nominal deficit of 9.34% as of July 2026. The Selic interest rate currently stands at 13.75%. Analysts suggest the current economic landscape shares similarities with the severe crisis seen during the Dilma Rousseff administration, specifically regarding the trajectory of debt and interest rates.

Market uncertainty remains high due to concerns over spending trajectories and the need for a credible fiscal consolidation plan. Investors are closely monitoring the formation of the economic team, seeking technical robustness and political ability to implement reforms and manage expenditures outside the official budget to avoid further economic stress.