REGRESA

1. Trump renews national emergency against Brazil, but with no tariff impacts

President Donald Trump has extended the national emergency declared against Brazil for another year, maintaining the legal basis for sanctions under the International Emergency Economic Powers Act (IEEPA). The renewal, which is required under US law to prevent the emergency measures from expiring, does not impose new penalties or expand existing measures. Although the IEEPA was previously used to impose tariffs of up to 50% on Brazilian goods, the US Supreme Court struck down its use for tariff purposes. As a result, the decision is not expected to have any practical impact on Brazilian exports.

The measure preserves the possibility of financial sanctions against Brazilian officials, such as asset freezes. In justifying the renewal, the White House reiterated allegations of political persecution against a former Brazilian president, censorship, and violations of freedom of speech by Brazil’s Federal Supreme Court (STF). Separately, Brazil remains subject to other tariffs announced in July, totaling 37.5%, stemming from investigations by the Office of the US Trade Representative into alleged unfair trade practices, including the Pix instant payment system and social media content moderation, as well as alleged shortcomings in combating forced labor.

Folha de S. Paulo: Trump prorroga decreto que mantém sanções ao Brasil, mas medida não deve ter efeito sobre tarifas

2. Brazil’s Federal Public Debt surpasses R$ 9 trillion in June

Brazil’s Federal Public Debt (DPF) rose 2.66% in June, increasing from R$8.798 trillion in May to R$9.033 trillion, driven primarily by the issuance of securities linked to the benchmark interest rate, the Selic. The National Treasury issued R$143.35 billion more in domestic bonds than it redeemed during the month, while R$85.16 billion in accrued interest was added to the outstanding debt stock. With the Selic rate at 14.25% per year, the indexation of these securities continues to increase the government’s debt burden. External public debt also rose 2.12%, reaching R$347.71 billion, largely reflecting the US dollar’s 2.37% appreciation against the Brazilian real during the month.

Despite the increase, the debt stock remains below the range projected in the Annual Financing Plan for the end of 2026, which forecasts between R$9.7 trillion and R$10.3 trillion. The government’s liquidity buffer, a financial reserve used to manage market volatility and concentrated debt maturities, reached a record R$1.346 trillion, the highest level since the series began in 2015, equivalent to 8.33 months of debt repayments. Securities linked to the Selic rate accounted for 49.32% of the total debt, while the average maturity declined from 4.07 to 4.01 years. Financial institutions remained the largest holders of government securities, with a 31.76% share, while foreign investors’ participation fell from 10.14% to 9.95% in June.

Agência Brasil: Dívida Pública sobe 2,61% em junho e supera R$ 9,2 trilhões

3. IPCA-15 rose 0.06% in July, the lowest increase for the month since 2023

Brazil’s official mid-month inflation index, the Extended National Consumer Price Index-15 (IPCA-15), rose 0.06% in July 2026, according to the Brazilian Institute of Geography and Statistics (IBGE). The reading came in below market expectations of 0.22% and marked a sharp slowdown from the 0.41% increase recorded in June. It was the lowest monthly reading since July 2023, when the index declined 0.07%. Inflation has accumulated 3.51% so far this year and 4.52% over the past 12 months, down from the 4.80% annual rate recorded in the previous period.

A 0.66% decline in the Food and Beverages category helped contain inflation in July after the segment had been a major source of upward pressure in June. In contrast, the house category rose 0.97% and made the largest positive contribution to the index due to the category’s 15.3% weighting in the IPCA-15 basket. Prices also increased in Health and Personal Care, Household Goods, and Transportation, while Clothing, Education, and Communication posted declines. The IPCA-15 tracks consumer prices for households earning between 1-40 times the minimum wage across the metropolitan areas of Rio de Janeiro, Porto Alegre, Belo Horizonte, Recife, São Paulo, Belém, Fortaleza, Salvador, and Curitiba, as well as Brasília and the municipality of Goiânia.

Exame: IPCA-15 de julho sobe 0,06% em julho, menor taxa para o mês desde 2023

4. Brazil’s unemployment rate falls to 5.4% through June, the lowest level on record

Brazil’s unemployment rate fell from 6.1% in the first quarter of 2026 to 5.4% in the three months through June, the lowest reading for this period since recording began in 2012. The result matched market expectations and was driven by continued job creation, which pushed the number of employed people to a record 103.1 million, according to the survey. The number of unemployed declined 10.9% to 5.9 million, with notable employment gains in public administration, education, healthcare, transportation, warehousing, and postal services.

Despite the still-tight labor market, economists and the Brazilian Institute of Geography and Statistics (IBGE) point to early signs of moderation. Average real monthly labor income stood at R$3,738, down 1.5% from the previous quarter, a change the IBGE considers statistically stable. Formal private-sector employment remained virtually unchanged at 39.4 million workers but continued at a record high. Analysts expect high interest rates, election-related uncertainty, and slower economic activity to moderate job creation throughout 2026, although the unemployment rate is likely to remain at historically low levels.

Folha de S. Paulo: Desemprego recua a 5,4% e tem menor taxa até junho na série histórica

5. Brazil extends debt renegotiation program to August 31st

The federal government will extend the enrollment deadline for Desenrola 2.0, its debt renegotiation program for Brazilians earning up to five times the minimum wage, until August 31st. According to Finance Minister Dario Durigan, the extension will allow more people to settle outstanding debts, including before applying for financing to purchase cars and motorcycles. By the end of June, the program had completed approximately 3.6 million debt renegotiations, covering more than R$22 billion in outstanding obligations, which were reduced to roughly R$4 billion. The government expects the initiative to benefit 10 million families, compared with more than 9 million already served.

Launched in May, Desenrola 2.0 allows for the renegotiation of debts contracted by January 31st, 2026, that have been overdue for between 90 days and two years, including credit card balances, overdraft facilities, and personal loans. The program offers interest rates of up to 1.99% per month and discounts ranging from 30% to 90% on the principal amount owed. Participants may also use up to 20% of their FGTS (Guarantee Fund for Length of Service) balance or R$1,000 – whichever is greater – to repay eligible debts.

G1: Governo prorroga adesão ao Desenrola 2.0 até 31 de agosto; programa renegocia dívidas