Brazil seeks a balance between debt and interest rates
Brazil's Deputy Finance Minister Dario Durigan emphasized the need to coordinate fiscal and monetary policies amid high interest rates and rising public debt. He expressed confidence that the country's revenues would recover by 2026 and highlighted the importance of finding a balance between social spending and fiscal discipline.
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Dario Durigan, Executive Secretary of Brazil's Ministry of Finance, emphasized the importance of aligning the country's fiscal and monetary policies, noting that high interest rates continue to drive up public debt.
Speaking on Thursday at an event in the lower house of parliament, Durigan commented on the Central Bank's recent decision to keep the key interest rate at 15%—its highest level in nearly two decades—without indicating when a reduction might be possible.
Durigan expressed confidence that by 2026, Brazil's revenues will reach 18.5% of GDP, matching the figures from 2022. He stressed that when shaping fiscal policy, it is essential to account for the growth of mandatory expenditures.
"We need to ensure coordination between our monetary and fiscal policies," Durigan stated during his presentation.
The Finance Ministry representative described the government's approach as seeking a balance between "left-leaning" views, which advocate for protecting disproportionate spending, and "right-leaning" positions, which call for excessive fiscal austerity.