Budget Guidelines Bill estimates peak in 2029, at 87.8% of Gross Domestic Product
The government’s economic team (PT) worsened the expected trajectory for DBGG (Gross General Government Debt) until 2035. In April 2025, the Ministry of Finance estimated a peak of 84.2% of Gross Domestic Product in 2028, which would subsequently fall. Now, the projection indicates an increase for 87,8% of GDP in 2029 before falling.
The debt-GDP (Gross Domestic Product) ratio went from 71.7% at the end of 2022 to 79.2% in February, which represents an increase of 7.5 percentage points under the Lula government.
The executive secretary of the Ministry of Finance, Rogério Ceron, who currently serves as interim minister with Dario Durigan’s trip abroad, declared that the debt was impacted by the increase in interest rates.
The basic rate, the Selic, has effects on the financial cost of public debt. In the 12 months up to February, for example, the country. Also contributing to the increase in debt was the growth in spending and the consecutive primary deficits in public accounts.
The central government did not record a positive balance in its accounts in all years of the Lula government’s 3rd term.
Ceron declared that, in 2023, the predicted scenario for United States interest rates was “very distinct” of the current one, which was reflected in the Brazilian economy.
“The long-term average interest rate, the ruler, was rising depending on the American market, and we also had a change in monetary policy here. We had some price shocks that required short-term action from monetary policy, and they had effects”said the interim minister.
According to Ceron, the worsening of the debt trajectory from 2025 to 2026 is due to the change in the rules for paying court orders.
“In relation to the last LDO, mainly due to the new precatório rule, which at that time there was no [regra de pagamento] and it generated that consequence of having a budget in 2027 that would be practically without discretionary expenses, and now you have a good balance between mandatory and discretionary expenses”these.
The government’s economic team (PT) sent (Budget Guidelines Law) which establishes that R$347 billion in court-ordered expenses will be left out of the calculation of the primary result target until 2035.
Precatório are debts that the government is obliged to pay after losing a definitive legal action, with no possibility of appeal. By removing these expenses from measurement, the federal government makes it easier to meet fiscal targets over the next few years.
GROSS DEBT
Brazil’s gross debt rose R$2.95 trillion in government (PT) until February, according to the Central Bank. Calculated by the national Treasury, the DPF (Federal Public Debt) stock rose from R$5.95 trillion in December 2025 to R$8.84 trillion.
The IMF (National Monetary Fund), in another way of making the calculation, said that the debt-GDP ratio will rise to 96.5% of GDP in 2026, until reaching 106.5% of GDP in 2031.
In a statement, the Ministry of Finance said that the Lula government has consistent medium and long-term planning to reduce debt. According to the text, the Lula government is committed to fiscal stability and reducing the debt trajectory.
According to the economic team, the IMF’s estimates, in the Fiscal Monitor, differ from the government’s projections due to methodological and parameter differences.
“Much of the difference lies in the treatment of securities in the Central Bank’s portfolio. The IMF includes all securities, including those in the free portfolio, that do not finance the Treasury, are not on the market and are not used for monetary policy. The more conservative assumptions in the growth parameters and long-term interest rates adopted by the IMF explain the remaining differences”these.
