DÍVIDA PÚBLICA MOBILIÁRIA FEDERAL BRASILEIRA: HISTORIA RECENTE E PERSPECTIVAS EXPLOSIVAS

Abstract

The article discusses the Brazilian domestic federal debt, and its immediate determinants. Since 1992 the debt has grown about 400% to 45% of GDP, and continues growing due mainly to high interest rates. A policy of sterilization of the influx of foreign exchange was an important expansion factor until 1998, when the exchange regime was changed to a floating one. A model of the debt is estimated and different scenarios for projections are evaluated for a 10 year period. The high interest rate is the most sensitive component to the evolution of the federal debt. The article concludes that the debt has grown fast, and that this tendency is difficult to be turned around in the near future. The value of future privatizations or budget surpluses is relatively small in terms of the debt and as policy instruments are therefore innocuous.