Brazil's fiscal balance deteriorating at an alarming pace

Brazil's central government revenue grew 3.3% yoy and spending rose 5.7% yoy in March, resulting in a consolidated primary surplus of BRL0.2bn, but a fiscal deficit of -BRL69.3bn as the interest portion stood at BRL69.5bn, an all time high. 

As a result and despite the primary surplus of 1.4% of GDP, Brazil likely posted a fiscal deficit of -9.0% of GDP in Q1 after posting back-to-back high deficits of -9.6% and -8.3% in Q3 and Q4 last year, notes Societe Generale in a report on Tuesday.