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Brazil to Keep $190 Billion Cash Cushion to Face Turbulence

  • Cash is used to pay down debt in case it’s not rolled over
  • Building solid 2022 budget is a challenge, Treasury chief says
Jeferson Bittencourt
Jeferson BittencourtPhotographer: Gustavo Raniere/Brazilian Treasury
Updated on

Brazil’s government plans to keep a cushion of at least 1 trillion reais ($190 billion) in cash next year to face local debt maturities as it braces for possible market turbulence in the run-up to presidential elections, according to Treasury Secretary Jeferson Bittencourt. 

The Treasury had a hard time in 2020, when investors concerned with President Jair Bolsonaro’s big spending plans to fight the pandemic had little appetite for anything other than short-term government bonds. Average debt maturities fell to 3.3 years last year, hitting a pandemic low of just 2.1 years in October -- from 4.8 years in 2019.