Budgetary discipline is viable and necessary

• PL dosimetry: The text which reduces Bolsonaro’s sentence is approved by the CCJ of the Senate and will be analyzed in plenary

This scenario reflects a structural issue that deserves attention: the relationship between fiscal policy and monetary policy. The Monetary Policy Committee (Copom) reiterated in its minutes its concern about the budgetary trajectory, particularly given the federal primary deficit projections. The National Treasury estimates a deficit of 73 billion reais in 2025, limiting the Central Bank’s ability to ease interest rate policy.

• Exchange for an economic agenda: The leader of the government in the Senate contradicts Gleisi and recognizes an agreement in favor of the project to reduce Bolsonaro’s sentence

It is important to recognize progress in fiscal management in several states. Paraná achieved a surplus of BRL 6.4 billion in 2024 and obtained in 2025, for the second consecutive year, the maximum capacity to pay rating (Capag A+), the result of consistent financial management and expenditure control. Initiatives such as the Agro-Industrial Production Chains Investment Fund (Paraná FIDC), which will allocate 1 billion reais of accumulated ICMS credits to agro-industry, demonstrate that it is possible to combine fiscal responsibility and strategic investments.

However, maintaining Selic at high levels has direct consequences on economic activity and families. The base interest rate serves as a floor to all other market rates, making consumer and investment credit more expensive. The services sector, the economy’s largest employer, posted modest growth of 0.6% in the second quarter of 2025, followed by industry (0.5%), reflecting the effects of monetary restrictions.

For families, the impact is particularly significant. High interest rates put pressure on the cost of credit in all its forms, affecting the budget and purchasing power of households. Even with an increasing wage bill, family debt has increased, limiting the dynamism of consumption and, consequently, economic activity, as the most recent figures already show.

The experience of States which have consolidated their finances demonstrates that budgetary discipline is a viable and necessary path. Brazil demonstrates its ability to grow even in difficult environments, as evidenced by the strength of agribusiness and the dynamism of the labor market. The next step requires all spheres of government to move forward in fiscal consolidation, creating the conditions for a virtuous circle of sustainable growth, with price stability and balanced development of all sectors of the economy.