Brazil Treasury Sees 2032 Debt Peak as Haddad Puts 2025 Deficit at 0.48% With Precatórios

Overview

• The Treasury’s January report projects gross public debt rising to 83.6% of GDP in 2026 and peaking at about 88.6% in 2032, with an adverse scenario near 95.4% by 2035.
• Primary balances are now forecast at a deficit of 0.2% of GDP in both 2026 and 2027, with a return to a small surplus only in 2028.
• Constitutional Amendment 136 excludes court-ordered payments from the fiscal target during a transition, with the excluded amount peaking around R$98.7 billion in 2028 and being fully reincorporated by 2036 under a minimum 10% annual rule.
• The Treasury says additional revenue measures will be required to align receipts with planned primary spending and to meet future fiscal goals.
• Finance Minister Fernando Haddad reports a preliminary 2025 primary deficit near 0.1% of GDP on a regular basis, rising to roughly 0.48% when precatórios and other exceptional items are included, and he cites high real interest rates as the main debt pressure.