R$ 10.78 billion. That was the primary surplus posted by Brazil's central government in July, the National Treasury reported on Thursday (27). In plain terms, the government took in more than it spent during the month, before interest payments, a cushion worth roughly R$ 50 per Brazilian resident.
The turnaround from last year is striking. In July 2025, the accounts closed R$ 59.1 billion in the red, according to Agência Brasil. Picture a household that blew its budget one year and managed to end the same month with cash left over the next. It was the best July result since 2022.
The figure also beat market expectations, though forecasts varied widely. Economists polled by Reuters expected a surplus of R$ 10.68 billion, Folha de S.Paulo reported. The Finance Ministry's own Prisma Fiscal survey, by contrast, pointed to a R$ 5.5 billion deficit for the month.
Understand it
The primary balance measures the gap between what the government collects and what it spends, excluding interest on the public debt. When money is left over, there is a surplus; when it falls short, a deficit. Brazil's central government combines the National Treasury, the social security system and the Central Bank.
July's result came from both sides of the ledger. Net revenue reached R$ 226.3 billion, a real increase of 7.7% over July 2025, driven by income tax, social security contributions amid record formal employment, and natural resource royalties boosted by higher oil prices. Spending fell 20.7% in real terms, to R$ 215.5 billion.
Much of the spending drop came from precatórios, court-ordered debts the government must pay. This year those payments were brought forward to March; in 2025 they were concentrated in July. According to Folha, outlays on judicial rulings fell 99% year on year, R$ 37.1 billion less, which also pulled pension benefit spending down 17.7%.
Keeping the brake on
One positive month does not erase the year's tally. From January to July, the central government has a deficit of R$ 81.3 billion, and over 12 months the shortfall reaches R$ 71.6 billion, or 0.55% of GDP.
Brazil's 2026 fiscal target, set under the country's spending rules known as the fiscal framework, calls for a R$ 34.3 billion surplus, with a tolerance band that allows a zero result. Public investment, meanwhile, fell 29.9% in July in real terms, but is still up 42.7% from January to July, according to the Treasury.