Brazil Posts Better-Than-Expected Deficit, Giving Small Respite

Brazil posted a better-than-expected budget deficit in 2024 thanks to record annual tax collections, an achievement that is unlikely to convince investors that President Luiz Inacio Lula da Silva is committed to fiscal responsibility.

Latin America’s largest economy reported a 43 billion reais ($7.3 billion) primary fiscal deficit, excluding interest payments, for all of last year, according to data released Thursday by the National Treasury. That’s equivalent to 0.36% of gross domestic product.

Still, legislation allows Brazil to exclude from the deficit extraordinary spending related to catastrophes, such as floods in the state of Rio Grande do Sul. This ability ...