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LatinNews Daily - 29 September 2021

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In brief: Brazil’s primary deficit shrinks in August

* Brazil’s economy ministry has released the latest figures on the government’s primary deficit, which show that the central government recorded a primary deficit of R$9.9bn (US$1.82bn) in August this year, a 90.6% reduction on the R$96.1bn primary deficit recorded in real terms in August 2020. The August result was better than market expectations, which pointed to a R$24.9bn primary deficit for August. In the first eight months of the year, Brazil’s central government (which encompasses the federal treasury, the central bank, and social security) has recorded a primary deficit of R$83.3bn, down 87.6% compared with the R$601.3bn primary deficit recorded over the same period last year. According to the economy ministry, this improved result is due to the positive evolution of the tax take, as well as “more targeted” spending in response to the coronavirus (Covid-19) pandemic. Jeferson Bittencourt, the secretary of the federal treasury, has noted that the central government would be recording a surplus were it not for ongoing pandemic-related spending, while warning that this “does not allow us to relax our caution over public accounts”. The government is projecting a R$139.4bn primary deficit for 2021, equivalent to 1.6% of GDP.