He fiscal deficit increased 20 basis points compared to last month and closed February reaching 3.4% of GDP, excluding income Social Security Trust (FSS), according to the report on the Public Sector Result of the Ministry of Economy and Finance (MEF).
In this way, the government moves away from the 3% goal proposed by the MEF at the beginning of a election year, condition that usually has an impact on the fiscal management of the accounts.
The report highlighted that the fiscal deficit It stood at 3.4% of GDP, improving towards 3.2% if the income of funds to the FSS is included. Meanwhile, the result of Global Public Sector (SPG) was 3.6% of GDP, reaching 3.8% once adjusted for the FSS effect.
Income, expenses and public accounts
Specifically, the income of the Central Government – Social Security Bank (GC-BPS) stood at 27.2% of GDP, increasing 0.1% year-on-year, due to the increase in collection of the DGI and other income.
Meanwhile, the primary expenditures of the GC-BPS stood at 27.9% of GDP, showing a monthly increase of 0.1%, fundamentally linked to higher transfer payments from the BPS. In turn, the interest payment The GC-BPS remained stable compared to the previous month, at 2.5% of GDP.
On the other hand, the result of the Public enterprises was zero in terms of GDP, unchanged compared to January, while that of Non-monetary Public Sector (SPNM) fell 10 basis points and stood at 3% of GDP, reaching 3.1% excluding FSS effects.
Finally, the overall result of the Central Bank of Uruguay (BCU) stood at 0.7% of GDP, remaining stable compared to January.
Fitch praised fiscal management, but warned about debt
The risk rating agency Fitch Ratings This Wednesday he praised the tax rule considering that “it is helping to improve the credibility” of Uruguay, although he issued a warning regarding the state of the public debt in relation to GDP.
“Consolidation still needs to be anchored enough to completely stabilize debt/GDP,” Fitch said in a statement published on its website, something to which it tied eventual support to improve the credit rating, a few weeks before Moody’s decide to upgrade your category.
In this scenario there also appears the possibility of a plebiscite that drives the PIT-CNT against social security reform, which is reviled by economists and members of the government, pointing out that it would skyrocket the deficit and could even lead to the loss of the investor grade.
Source: Ambito
