July 22 (Bloomberg) -- Brazil plans to sell dollar- denominated bonds in overseas credit markets in coming weeks, Treasury Secretary Arno Augustin said.

The country will tap the market more than once before yearend and look to sell securities maturing in more than 10 years, Augustin, who heads Brazil’s treasury, said in an interview with Bloomberg Television in Brasilia today.

“We will certainly issue foreign bonds more than once in the second half, seeking to lengthen the debt’s profile and create conditions” for companies to sell bonds, Augustin said. There is investor demand for bonds maturing in 30 years, he said.

Brazil plans to tap international credit markets as speculation the global recession is easing fuels demand for higher-yielding assets. The yield to the 2015 call date on the country’s 11 percent bond due in 2040, one of the most widely traded emerging-market securities, has tumbled 1.80 percentage points to 5.02 percent since March 2, according to JPMorgan Chase & Co. The bond’s price has climbed 10.4 cents on the dollar to 130.90 cents.

Brazil sold $750 million of 10-year bonds in international markets in May in a re-opening of securities the government first issued in January. It priced the bonds to yield 2.52 percentage points over U.S. Treasuries. Brazil sold $1.03 billion of the 5.875 percent securities due in 2019 to yield 6.13 percent, or 3.7 percentage points more than U.S. Treasuries on Jan. 6.

‘Improving’ Markets

Developing nations including Poland, Peru and the Philippines have sold bonds abroad so far this month. Ecopetrol SA, Colombia’s state-run oil producer, and Brazil’s state development bank are among Latin American companies that have issued debt in the past two months.

“Market conditions are improving,” Augustin said. “We slowly see markets returning to a phase near normality.”

Brazil may also sell reais-denominated bonds by yearend, according to Augustin.

The yield on Brazil’s benchmark zero-coupon local bond due in January 2010 has dropped 3.48 percentage points since the beginning of January to 8.66 percent as the central bank cuts interest rates to a record low, according to Banco Votorantim. Policy makers have trimmed the overnight target to 9.25 percent from 13.75 percent at the end of last year in a bid to pull the economy out of recession.

Brazil’s central bank will cut the rate by a half percentage point to 8.75 percent at a policy meeting today, according to the median forecast of 50 economists in a Bloomberg survey.

To contact the reporter on this story: Andre Soliani in Brasilia at asoliani@bloomberg.net; Carla Simoes in Brasilia at csimoes1@bloomberg.net.

Last Updated: July 22, 2009 13:30 EDT