Brazilian Government Bond Sales Record Best November in History

RIO DE JANEIRO, BRAZIL – The sale of public bonds to individuals totaled R$1.87 billion (US$468 million) in November, the National Treasury reported yesterday, December 20th. The amount sold through the Tesouro Direto (“Direct Treasury”) program is the best in history for the month, outperforming the previous record of R$1.84 billion in November 2016.

The number of active investors totaled 1,172,771. Last month alone, 1,355 investors began participating in public bonds. The number of registered investors – active and non-active – totaled 5,431,958 people.

Last month, the best selling bonds were linked to official inflation by the Broad National Consumer Price Index (IPCA). These bonds accounted for 43.2 percent of sales in November. Next came the SELIC rate-adjusted bonds (basic economic interest rates), which accounted for 40 percent of sales.

Third came fixed-rate bonds (with pre-defined interest rates), which accounted for 16.8 percent of sales. Lower value investments continued to lead investors’ preference. Sales below R$1,000 accounted for 66.6 percent of the total invested in the month.

The November result showed a slight 0.02 percentage points drop in the stock of public bonds invested in the Tesouro Direto against October, totaling R$59.2 billion. This was due to the fact that last month, the Treasury redeemed R$2.34 billion. The variation in the stock represents the difference between sales and redemptions, plus the interest on bonds.

Tesouro Direto was established in January 2002 to promote this type of investment and allow individuals to buy public bonds directly from the Treasury, through the Internet, without the intermediation of financial agents. The investor only has to pay a fee to the brokerage house responsible for the bond custody. Further information is available on the Tesouro Direto website.

The sale of bonds is one of the government’s means of raising funds to pay debts and honor commitments. In exchange, the National Treasury undertakes to return the amount with an additional sum that may vary according to the SELIC, inflation index, exchange rate or a rate previously determined in the case of prefixed bonds.

Source: Agência Brasil