FX.co ★ Brazil's Nominal Budget Deficit Narrows in January

Brazil’s nominal budget deficit narrowed to R$40.1 billion in January 2026, down from R$63.7 billion in the same month of the previous year, and came in slightly below market expectations of R$49.5 billion. The consolidated public sector registered a primary surplus of R$103.7 billion, essentially in line with the R$104.1 billion recorded in January 2025.

The Central Government and regional governments posted surpluses of R$87.3 billion and R$21.3 billion, respectively, while state-owned enterprises reported a deficit of R$4.9 billion.

Nominal interest expenses for the consolidated public sector reached R$63.6 billion in January, up from R$40.4 billion a year earlier. This increase reflected higher Selic rates and an expansion in net debt, which more than offset gains from foreign-exchange swap operations.

Over the twelve months through January, the nominal deficit totaled R$1,086.2 billion, equivalent to 8.49% of GDP.