The Brazilian government posted a nominal budget deficit of BRL 97.6 billion in July 2026, narrowing from BRL 175.6 billion in the same month a year earlier and exceeding market expectations of a BRL 84 billion shortfall. The federal government recorded a BRL 11 billion surplus, while regional governments posted a BRL 8.5 billion deficit and state-owned companies registered a BRL 1.1 billion shortfall. Meanwhile, gross government debt rose to 82.5% of GDP in July, the highest level since October 2021, up from 81.9% in the previous month and above market forecasts of 82.2%. Over the 12 months through July, the nominal public sector deficit narrowed to 0.67% of GDP from 1.19% in the previous month.