BRASILIA, Nov 29 (Reuters) - The primary surplus of Brazil's central government fell sharply in October compared to a year earlier, increasing pressure on the next government to get its fiscal accounts back in order.
The central government -- which includes the national treasury, the central bank and the social security system -- posted a 7.7 billion reais ($4.5 billion) surplus in October, down from a 11.2 billion reais surplus in the same month in 2009, the national treasury said on Monday.
The surplus was the smallest for the month of October since 2006 as spending increases outpaced revenue growth.
The number also represented a plunge from last month's previously reported record 26.1 billion reais surplus, when the government benefited from income linked to a large Petrobras stock offering.
The accumulated surplus from January to October totaled 63.383 billion reais, or 2.19 percent of the gross domestic product. That compares to a surplus of 1.05 percent of GDP for the same period in the previous year.
The October result could renew pressure on President-elect Dilma Rousseff's incoming government to carry out pledges that it will make substantial cuts to the 2011 budget. Rousseff will be sworn in as Brazil's next president on Jan. 1.
Some analysts and government officials see tighter government spending as the most effective way to help push borrowing costs lower. At 10.75 percent, Brazil's interest rates are among the world's highest, and are considered to be an obstacle to strong, long-term growth.
The central government's primary surplus for the year to date rose sharply compared to a year ago, but that was also due to the Petrobras-linked revenues. The surplus totaled 63.4 billion reais between January and October -- the equivalent of 2.19 percent of gross domestic product, compared to 1.05 percent of GDP for the same period in 2009.
The data comes only one day before the central bank releases consolidated budget numbers, which have deteriorated sharply in 2010 due to rising government spending in an election year.
The consolidated primary surplus represents the excess of revenues over expenditures, excluding interest payments on debt.
(Reporting by Isabel Versiani; Writing by Ana Nicolaci da Costa and Luciana Lopez; Editing by Raymond Colitt, Kenneth Barry and Diane Craft)
($1=1.720 reais) Keywords: BRAZIL ECONOMY/BUDGET (ana.nicolacidacosta@thomsonreuters.com; Reuters Messaging: ana.nicolacidacosta.thomsonreuters.com@reuters.net; +55-61-3426-7027) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
The central government -- which includes the national treasury, the central bank and the social security system -- posted a 7.7 billion reais ($4.5 billion) surplus in October, down from a 11.2 billion reais surplus in the same month in 2009, the national treasury said on Monday.
The surplus was the smallest for the month of October since 2006 as spending increases outpaced revenue growth.
The number also represented a plunge from last month's previously reported record 26.1 billion reais surplus, when the government benefited from income linked to a large Petrobras stock offering.
The accumulated surplus from January to October totaled 63.383 billion reais, or 2.19 percent of the gross domestic product. That compares to a surplus of 1.05 percent of GDP for the same period in the previous year.
The October result could renew pressure on President-elect Dilma Rousseff's incoming government to carry out pledges that it will make substantial cuts to the 2011 budget. Rousseff will be sworn in as Brazil's next president on Jan. 1.
Some analysts and government officials see tighter government spending as the most effective way to help push borrowing costs lower. At 10.75 percent, Brazil's interest rates are among the world's highest, and are considered to be an obstacle to strong, long-term growth.
The central government's primary surplus for the year to date rose sharply compared to a year ago, but that was also due to the Petrobras-linked revenues. The surplus totaled 63.4 billion reais between January and October -- the equivalent of 2.19 percent of gross domestic product, compared to 1.05 percent of GDP for the same period in 2009.
The data comes only one day before the central bank releases consolidated budget numbers, which have deteriorated sharply in 2010 due to rising government spending in an election year.
The consolidated primary surplus represents the excess of revenues over expenditures, excluding interest payments on debt.
(Reporting by Isabel Versiani; Writing by Ana Nicolaci da Costa and Luciana Lopez; Editing by Raymond Colitt, Kenneth Barry and Diane Craft)
($1=1.720 reais) Keywords: BRAZIL ECONOMY/BUDGET (ana.nicolacidacosta@thomsonreuters.com; Reuters Messaging: ana.nicolacidacosta.thomsonreuters.com@reuters.net; +55-61-3426-7027) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.