Brazil proposes 2027 budget with R$ 1,741 minimum wage

The Brazilian government has submitted the 2027 Annual Budget Law (PLOA) to Congress, proposing a minimum wage of R$ 1,741 starting in January. This represents a nominal increase of 7.4% compared to the previous period, calculated based on inflation (INPC) and economic growth.

Key economic projections in the proposal include a GDP growth rate of 2.46%, which is more optimistic than the 1.5% projected by the financial market. The government also forecasts inflation (IPCA) at 3.6% and the Selic interest rate at 11.41% by the end of 2027.

Regarding fiscal targets, the budget aims for a primary surplus of R$ 18.6 billion for the central government, equivalent to 0.1% of GDP. When adjusted for fiscal target compliance, the projected surplus is R$ 83.4 billion, or 0.6% of GDP. The proposal will undergo analysis by the Joint Committee on Public Plans, Budgets, and Oversight (CMO), with a target approval deadline of December 22.