Brazil

The share of foreign investors in Brazilian public debt fell in August to the lowest level in more than 12 years, official data showed on Wednesday, despite high yields on government bonds, Reuters reported. According to the Treasury, the share of foreigners in domestic public debt fell to 8.84% in August, from 9.01% in July, the lowest level since December 2009. This occurred despite high yields in government bonds amid an aggressive monetary tightening to battle inflation in Latin America's largest economy.

Outstanding loans in Brazil kept growing in August, according to central bank data on Wednesday, with credit showing robustness despite rising costs amid an aggressive monetary tightening, Reuters reported. Outstanding loans were up 1.6% in August from the month before to 5.067 trillion reais ($940.48 billion). In July, outstanding loans rose 0.6%, a figure that had not yet been released by the central bank, which is still normalizing its data after a strike by its employees earlier this year.

Brazil's central bank chief Roberto Campos Neto said that policymakers aren't focusing on monetary easing at the moment as the priority remains on bringing back inflation to the official target, Reuters reported. "We've been communicating that we don't look, don't think about falling interest rates at this moment," Campos Neto said late on Monday in a speech at an event hosted by the Valor Econômico newspaper. "We think about finishing the work. Finishing the work means converging inflation," he said.

Brazil's government debt fell to its lowest level since the start of the coronavirus pandemic amid favorable fiscal data, central bank data showed on Wednesday, Reuters reported. The country's debt as a share of gross domestic product dropped to 77.6% in July, from 78% in June, the lowest figure since March 2020, when it reached 77.03%. At the peak of the spending spree to fight the pandemic, the indicator reached 89% of GDP.

Brazil posted a current account deficit of $3.5 billion in May, the worst result for the month in eight years, amid trade balance weakening, central bank figures showed on Friday, Reuters reported. A strong commodities producer, Brazil has seen its exports grow, but imports have increased at a faster pace, driven by higher prices for products such as fuel and fertilizers. In May, the trade balance surplus was $3.4 billion, down 53.3% over the same month last year.

Brazilian central bank chief Roberto Campos Neto on Tuesday predicted that inflation will reach 6.5% or a little lower this year, amid government measures that lowered taxes on key goods, Reuters reported. The estimate is more optimistic than private economists' expectations of inflation at 6.82%, according to a central bank weekly survey, but still above the official target of 3.5%, plus or minus 1.5 percentage point. "This year, inflation is going to be around 6.5%, perhaps a little bit lower.

Brazil's consumer prices decreased more than expected in July, the country's statistics agency said on Tuesday, with the steepest drop ever on the benchmark IPCA index off the back of a string of anti-inflation measures by the government and central bank, Reuters reported. Prices in Latin America's largest economy fell by 0.68% last month, the IBGE statistics agency said. It was the lowest rate recorded since inflation measurements began in January 1980, IBGE said.

Brazil's Economy Ministry expects the central government to post a primary surplus of 6 billion reais ($1.15 billion) this year, its first since 2013, according to internal estimates seen by Reuters. An official from the ministry, speaking on condition of anonymity as the calculations are not public, called the estimate conservative because it considers 36 billion reais in extraordinary dividends in 2022.

Brazil posted a lower than expected trade surplus of $5.444 billion in July, official data showed on Monday, with growth in imports again strongly outpacing that of exports, Reuters reported. The figure came below the median forecast of a $6.993 billion surplus in a Reuters poll. Imports rose 41.6% in July over the same month last year, to $24.511 billion, the Economy Ministry said. Exports grew by 23%, to $29.955 billion, added the ministry, stressing that higher prices boosted the results in both cases.

Brazil created a net 277,944 formal jobs in June, with all sectors of the economy posting growth, figures from the country's labor ministry showed on Thursday, Reuters reported. That number, however, was lower than the 317,812 jobs created in the same month last year, said the ministry, which based its figures on adjusted government data. Net job creation in South America's largest economy reached 1.335 million in the six months of the year, with each month recording growth.