Key facts
- Brazil's share of debt linked to the Selic rate increased to 52.7% in August.
- The Treasury raised its 2026 ceiling for floating-rate debt to 53% last month.
- Brazil's benchmark Selic rate stands at 13.75%.
- Brazil's federal public debt rose 0.04% in August to 9.293 trillion reais ($1.78 trillion).
- Interest costs totaled 88.4 billion reais in August.
Brazil's debt profile worsened in August as the share of liabilities linked to the benchmark Selic rate climbed to 52.7%, up from 51.1% in July, according to Treasury data. This increase leaves the government's finances more exposed to monetary policy, with high borrowing costs feeding directly into debt accumulation. The rise follows the Treasury's decision last month to raise the 2026 ceiling for floating-rate debt to 53%. Despite an easing cycle that began in March, Brazil's Selic rate remains elevated at 13.75%, one of the highest real interest rates globally. This situation highlights the economic challenge for Latin America's largest economy: while high interest rates are crucial for curbing inflation, they also significantly increase the cost of servicing the national debt. In August, Brazil's federal public debt saw a marginal increase of 0.04% from the previous month, reaching 9.293 trillion reais ($1.78 trillion), primarily due to interest expenses totaling 88.4 billion reais. The country experienced a net debt redemption during August, with bond issuance at 211.6 billion reais against maturities of 296.1 billion reais.