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Brazilian are drowning in debt, but rates will remain high

Financial data shows that families are struggling to make ends meet, which is particularly dangerous considering that borrowing costs will remain elevated


Reportagem de Ana Ferraz

Never has a larger share of Brazilians owed money. New data from the Central Bank shows that thecountry's household indebtedness levels reached 53.1percent in July, a new record (in the data series starting in 2005). Almost one-third of families' monthly income is eaten up by debt payments.


This is the result of a combination of worsening economic conditions, with prices climbing at a fast pace while wages stagnate, and persistently high interests.


Since March 2021, Brazil has undergone one ofthe world's steepest monetary tightening processes, v.rith benchmark interest rates climbing from 2 percent a year to the current 13.75 percent.Last week, the Central Bank told markets it would remain "vigilant" around an inflationary environment that "remains challenging" - confirming what we had anticipated back in June: interest rates shall remain high.


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Debt is rising for Brazilian families - Carla Beni
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