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Brazil’s gross debt has entered a new upward trajectory in IMF projections, with a forecast to reach 100% of GDP by 2027 and continue rising until 2031
Brazil’s gross debt is expected to reach 100% of GDP by 2027, according to new projections released by the International Monetary Fund on Wednesday, the 15th, in the Fiscal Monitor report, which also raised estimates for 2026 and subsequent years.
Projection rises for the coming years
The IMF now predicts that Brazil will end 2026 with gross debt equivalent to 96.5% of GDP. Under the new trajectory, the indicator will continue to rise in the following years.
The Fund’s estimate indicates that gross debt will reach 100% of GDP in 2027. After that, it will continue to rise until it reaches 106.5% of GDP in 2031, the last year covered by the released projections.
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Revision worsens previous scenario
The new forecasts represent a deterioration compared to the estimates released in October. At that time, the IMF projected a debt of 95% of GDP already this year.
For 2027, the previous expectation was 97% of GDP. The projection also indicated stabilization close to 98% starting in 2028, without the indicator reaching 100% in the following years.
According to the Fund’s calculations, Brazil closed last year with a debt of 93.3% of GDP. The revision reflects a more negative outlook for the primary result and the nominal result of public accounts.
This nominal result includes interest payments on the debt. Thus, the new reading presented by the report shows deterioration in the estimated trajectory for Brazilian public accounts.
IMF calls for reinforcement of fiscal rules
In the report, the IMF states that emerging countries have made progress in recent decades by building more resilient economic policies to face shocks, such as the pandemic and the recent rise in oil prices linked to the war in Iran.
Among the factors cited by the Fund are the independence of central banks, inflation targeting regimes, more robust fiscal structures, and the development of local currency debt markets.
Even so, the institution assesses that it will be necessary to strengthen the commitment to fiscal targets. For Brazil, the report states that it will be necessary to strengthen the fiscal framework with medium-term mechanisms.
According to the Fund, these anchors need to provide more predictability to public accounts and contain pro-cyclical pressures. Strengthening the fiscal framework appears as a central point in the assessment of the country.
Differences in gross debt calculations
Gross debt is one of the main indicators monitored by investors to measure a country’s ability to pay. Nevertheless, the methodology used by the IMF differs from that adopted by the Brazilian government.
The Fund includes in its calculation the Treasury bonds held by the Central Bank. This portion is not included in the official calculation used by Brazil.
According to Brazilian methodology, gross debt closed 2025 at 78.7% of GDP and rose to 79.2% in February, according to data from the Central Bank. This was the highest level since November 2021 under this criterion.
Under the IMF’s criterion, the debt is higher because it includes these securities.
With information from Exame.
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