Brazilians withdraw US$1 billion from savings accounts in February

RIO DE JANEIRO, BRAZIL – Brazilian savings accounts shrank by R$5.83 billion (US$1.04 billion) in February, figures showed on Thursday, March 4th, the second month of withdrawals after the end of emergency government cash transfers forced consumers to dip deeper into savings.

It follows a record R$18.2 billion net withdrawal in January and is the first time in just over a year that savings account deposits have fallen two months in a row, central bank data showed.

Brazilians deposited a record net R$166.3 billion into savings accounts last year. The COVID-19 pandemic initially hammered spending, then some consumers squirreled away part of the emergency government aid in the second half of the year.

But that support for up to 30 million families expired on December 31st, and the data for January and February shows consumers are eating in to the record mountain of savings amassed last year.

With a deadly second wave of the pandemic sweeping the country, Brazil’s Senate on Thursday passed a bill paving the way for an extension of these emergency cash transfers worth up to R$44 billion over the coming months. The bill awaits final approval in the lower house.