Brazil posts primary surplus of 2.3 bln reais in July

SAO PAULO Fri Aug 30, 2013 9:42am EDT

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SAO PAULO Aug 30 (Reuters) - Brazil posted a primary budget surplus of 2.3 billion reais ($975.8 million) in July , central bank data showed on Friday, narrowing sharply from the previous month as government revenue continued to disappoint.

The primary budget balance, which represents the public sector's excess revenue over expenditures before debt payments, was expected to reach a surplus of 6 billion reais, according to the median forecast of 12 analysts surveyed by Reuters. The country had a primary surplus of 5.429 billion reais in June.

The primary balance is a gauge closely watched by investors because it measures a country's ability to service its debt. The government missed its primary surplus target in 2012 and will miss it again this year as a slew of tax breaks aimed at reviving the economy hits revenues. The country posted a nominal budget deficit of 21.1 billion reais in July.

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