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Federal Public Debt stock totaled R $ 3.891 trillion in May

National treasure

In the month, the average cost of domestic debt issuance accumulated in twelve months is once again the lowest value of the historical series

The National Treasury released the Federal Public Debt Monthly Report (DPF) for the month of May.

The stock of debt increased in nominal terms by 0.31%, from R $ 3.879 trillion in April to R $ 3.891 trillion in May.

The Domestic Federal Public Debt (DPMFi) had its stock increased by 0.32%, from R $ 3,723 trillion to R $ 3,735 trillion. The increase was due to the positive appropriation of interest of R $ 27.94 billion, partially offset by the net redemption in the amount of R $ 16.03 billion.

In May, DPMFi issues reached R $ 82.85 billion, of which R $ 36.96 billion in fixed-rate securities, R $ 12.46 billion remunerated by price index and R $ 33.41 billion in indexed securities floating rate. Of this total, R $ 72.59 billion were issued in traditional auctions, R $ 1.89 billion in exchange auction, R $ 5.86 billion in sales of Treasury Direct and R $ 2.5 billion in emissions.

The average cost of domestic debt issuance in the last 12 months was 7.13% per year, once again representing the lowest value of the historical series (which began in December 2010).

In relation to the external Federal Public Debt (DPFe) stock, there was an increase of 0.16% over April, ending the month of May at R $ 155.54 billion. Of this total, R $ 140.93 billion refers to securities debt and R $ 14.62 billion to contractual debt.

Markets in May

In May, the tone in the foreign market was predominantly 'negative' as assessed by the National Treasury team and presented by Luis Felipe Vital (general coordinator of Public Debt Operations), Lena Carvalho (Coordinator of Public Debt Strategic Planning ) and Luiz Fernando Alves (coordinator of Control and Payment of Public Debt).

Among the factors of influence, which also had an impact on the emerging market, are the intensification of the debate related to the monetary policy of the United States and some 'noises' related to the commercial war between the two major economic powers.

On the other hand, in the domestic sphere the scenario was predominantly positive - despite the global and emerging markets in the opposite direction. "The optimism represented by the fall in the interest rate curve during the month is a symptom of greater investor confidence related to the reform agenda, especially Social Security," explained Vital.

Holders

Non-residents showed an increase of R $ 10.61 billion in their inventory, which increased the relative participation of this group, which increased from 12.5% ​​to 12.7%. Since the beginning of the year, this group's share has gone from 11.2% to the current 12.7%. The continued increase is also due to positive expectations related to the advancement of the political agenda. For the Treasury, an even more consistent increase in Non-Resident stock is expected after approval of the New Pension and other reforms.

The Government group had a relative share of 4.07%. The inventory of insurance companies ended the month at R $ 151.67 billion. In the Previdência group, there was a reduction of the inventory, which went from R $ 951.52 billion to R $ 927.45 billion.

Financial institutions increased their stock by R $ 15.70 billion, reaching R $ 821.67 billion in the month. The Investment Funds group also increased its stock, from R $ 972 billion to R $ 993 billion and remains the main holder, with a 26.58% share in the month.

Treasury Direct

The report points out that May was atypical for the Direct Treasury, being simultaneously the month with the largest volume of issues and also the largest flow of redemptions of the entire historical series. The most demanded was the IPCA +, responsible for 43.6% of the emissions in the month.

It was also characterized by net redemption after a 10-month run of net issues. The sale of securities was R $ 5.860 billion while redemptions corresponded to R $ 10.07 billion. The Treasury Direct stock closed the month at R $ 55.54 billion, representing a reduction of 6.33% in relation to April 2019.

Last month, the program registered 187,000 new registered investors, of which 28,545 actually purchased title in the first month of participation in the program. The number of active investors is 1.03 million and represents an increase of 69.9% in the last twelve months alone.

Market in June

According to the Treasury's assessment before the end of the month, the tone of the global market has already turned to positive, a scenario that has already hit the emerging economies. To a large extent, the change in outlook is due to announcements and signs of reductions in interest rates by various central banks around the world.

As for the domestic market, the June result is positive and under the same expectations related to the progress of the reform process that generated the optimism that prevailed in April.