Federal public debt advances 2.51% in June, to R$5.8 billion

The Federal Public Debt in Brazil rose 2.51% in nominal terms in June, totaling a stock of R$5.8 billion. In May, this amount was R$ 5.70 billion. The data were released this Wednesday (27), by the secretary of the National Treasury of the Ministry of Economy.

According to the document, “the month of June was marked by an increase in risk aversion, due to the expectation of continued monetary tightening in the United States and inflationary pressures at a global level.”

The DPF, which includes the federal government’s internal and external debt, is the issuance of public bonds by the National Treasury to finance the federal government’s budget deficit, which collects less than it spends.

According to the Treasury, the increase in the indicator was due to the increase in bond issues, which reached R$ 67.33 billion. The average cost of FPD also increased, influenced by the advance in interest, and reached 10.9% per year in the last month, compared to the cost of 10.58% per year recorded in the previous month. In December 2021, the cost of public debt was 8.91%.

Mattress liquidity rose

Also according to the Treasury, the FPD liquidity reserve increased by 10.23% in nominal terms, from R$1.108 billion in May to R$1.221 billion in June. In addition to the net issuance of R$ 67.3 billion, the receipt of R$ 26.2 billion in dividends is also one of the main factors for the increase.

The liquidity ratio reached its best level since March, which, according to the Treasury, guarantees payment for the next 9.75 months of bond maturities. The authority highlights that the months of August, January 2023 and May 2023 will concentrate maturities estimated at R$ 717.36 billion.

The slack presented in the government reserve removes the Union from the risk of having to refinance its debt.

“The Liquidity Ratio went from 9.47 months in May to 9.75 months in June. Such amounts remain well above the 3-month prudential limit for the Liquidity Reserve, which in June/22 is equivalent to R$ 556 billion”, says the document.

The Treasury also assesses that the Central Bank’s Operating Result for 2021, in the amount of BRL 73 billion, the untying of BRL 47 billion in resources from public funds and the BRL 19 billion in additional dividends from BNDES already received were factors that contributed favorably to the debt reserve balance.

With a total of BRL 139 billion, the three events outweigh the financial effect of the reduction in issuances due to recent market volatility. Thus, the ministry highlights that it sees no reason for changes in the FPD financing strategy due to current financial market conditions.