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Federal Public Debt Inventory totaled R $ 3.978 trillion in June

NATIONAL TREASURE

12-month average cost of domestic debt issues is once again the lowest in the historical series

The National Treasury released, this Thursday (25/7), the  Monthly Federal Public Debt (DPF) Report of June  Debt stock increased by 2.24% in nominal terms, from R $ 3,891 trillion in May to R $ 3,978 trillion in June.

The domestic Federal Public Securities Debt (DFPD) was increased by 2.44%, from R $ 3.735 trillion to R $ 3.826 trillion. The increase was due to the net issuance of R $ 68.40 billion and positive interest appropriation of R $ 22.60 billion.

In June, DFPD issuances reached R $ 71.13 billion, of which R $ 38.95 billion in fixed-rate securities, R $ 9.71 billion in index-linked securities and R $ 22.44 billion in index-linked securities. at the floating rate. Of this total, R $ 68.08 billion were issued in traditional auctions, R $ 2.68 billion in exchange auction, R $ 2.68 billion in sales of Treasury Direct and R $ 370 million in direct issuances. .

The average cost of domestic debt issues in the last 12 months was 7.12% per year, a figure that represents, once again, the lowest value in the historical series (which began in December 2010).

Regarding the Federal External Public Debt (EFPD) stock, there was a reduction of 2.48% over the stock recorded in May, ending June at R $ 151.68 billion, of which R $ 138.09 billion related to debt. R $ 13.59 billion to contractual debt.

June Markets

In June, the tone in the markets in general was “extremely positive” and, at the national level, there was “noticeable reduction in interest rates” according to an assessment made by the National Treasury team and presented by the Debt Operations coordinator, Roberto Lobarinhas, the general coordinator of Debt Control and Payment, Márcia Tapajós and the general coordinator of Strategic Planning of Public Debt, Luiz Fernando Alves.

According to Roberto Lobarinhas, the positive tone in the domestic market can be explained basically by three factors. As noted by the Treasury, the domestic market has come to believe that interest rate reductions will continue to occur later this year.

The second cause is related to advances in the legislative process in social security reform. Finally, the external factor, related to the reduction of interest rates in the international market under the influence of those in force in Europe and North America.

Holders

The Social Security stock decreased in the month, from R $ 927.45 billion to R $ 914.86 billion, between May and June. As a result, the relative share of the group fell to 23.91%. Financial Institutions increased their inventory by R $ 64.92 billion, reaching R $ 886.59 billion in the month. Thus, the relative share went from 22.00% to 23.17%.

Investment Funds also increased the stock, from R $ 992.80 billion to R $ 1,027.39 billion in the same period. This group remains the main holder, with a 26.85% stake in the month. Non-residents, in turn, had a reduction of R $ 3.96 billion in inventory, which reduced the relative share of the group from 12.74% to 12.34%. The Government group had a relative share of 4.09% in June and the Insurers' inventory ended the month at R $ 153.41 billion.

Specifically regarding the drop in the participation of Non-residents, clarified the coordinator Roberto Lobarinhas, it is a one-off decrease that will not reverse the trend of expressive increase in the group's participation expected for the year. This reflects the trend that foreign investment stocks have achieved the largest positive change since Brazil lost its investment grade by international rating agencies in the second half of 2015.

Direct Treasury

Treasury Direct issues in June reached R $ 2,679.94 million, while redemptions corresponded to R $ 1,683.22 million, which resulted in a net issuance of R $ 996.71 million. The most demanded security by investors was the Selic Treasury, which accounted for 49.09% of the amount sold. Treasury Direct stock reached R $ 56,938.29 million, an increase of 2.51% over the previous month. The security with the largest representation in stock is the IPCA + Treasury, which corresponds to 35.42% of the total.

Regarding the number of investors, 157,858 new participants registered with Treasury Direct in June. As a result, the total of registered investors reached 4,351,235, which represents an increase of 90.01% over the same month of the previous year.

According to the coordinator Roberto Lobarinhas, the Treasury Direct Securities Purchase Operations Index of up to R $ 5,000 greater than 85% is a symptom of the effective 'pulverization' and reinforces the democratic and educational character of the program.

But the highlight of the month for Treasury Direct is the participation of women. Together, they accounted for 31.1% of total active investors in July, an index that is the largest hit by the women's group since the founding of the program.

July Market

According to the Treasury assessment even before the end of the month, the general market tone in July follows the trend of the previous month: the prospect of low interest rates in the European and US markets.

In the domestic market, with the approval of the Social Security Reform by the Chamber of Deputies in the first round, interest rates continued to fall throughout the month. The improvement in the political scenario can be seen in the reduction of DFPD emission rates in July.

Federal Public Debt reports, tables and presentations are available at  http://www.tesouro.fazenda.gov.br/en/relatorio-mensal-da-divida