The yield on Brazil’s 10-year government bond has decreased to 12.3%, retreating from a peak of 12.485% recorded in April 2023. This decline occurs in the context of enhanced domestic fiscal conditions.
Recent developments include Moody’s upgrade of Brazil’s credit rating to Ba1, marking a significant sttoward attaining investment-grade status. This upgrade is a testament to Brazil's progress in fiscal management and a more positive economic outlook, significantly bolstering international confidence in the country’s financial stability.
Additionally, the Brazilian government's strategic decision to freeze R$3.67 billion from the Growth Acceleration Program and R$974.8 million from committee amendments highlights its commitment to fiscal discipline. A downward revision of the 2024 deficit estimate has further reassured markets, reinforcing confidence in Brazil’s fiscal and economic path.
As of Friday, October 4, the Brazil 10-Year Bond Yield stood at 12.33% according to over-the-counter interbank yield quotes. Analysts and global macro models predict a trading forecast of 12.27% by the end of this quarter, with a further expectation to reduce to 11.86% in the next twelve months.