UPDATE 3-Brazil primary budget surplus rises to June record

(Recasts, adds comments from central bank)

By Isabel Versiani

BRASILIA, July 31 (Reuters) - Brazil's consolidated primary budget surplus BRPSPS=ECI grew to a record for the month of June, climbing to 11.65 billion reais ($6.22 billion) from a surplus of 10.44 billion reais a year earlier, the central bank said on Tuesday.

The result was higher than the 9.9 billion reais median estimate of 18 economists in a Reuters poll. The estimates ranged from 6.0 billion reais to 12.1 billion reais. In May, the consolidated primary surplus was 9.3 billion reais.

A strong surplus from state governments boosted the June result, as did a record contribution from federally run companies such as oil giant Petrobras (PETR4.SA)(PBR.N), said the bank's economic research director, Altamir Lopes.

"The primary result was the best ever for June, driven by state governments, whose revenues rose in line with economic activity," he said.

State and city governments produced a collective surplus of 3.33 billion reais, while state-run companies contributed 2.84 billion reais.

Lopes said monthly surpluses will tend to decrease in the second half of the year as government spending increases.

The primary budget surplus, which excludes interest payments, is closely watched by investors as a gauge of Brazil's ability to service its debt.

In the 12 months through June, the surplus was equal to 4.30 percent of gross domestic product compared with 4.29 percent of GDP in the 12 months through May.

The government lowered its primary surplus target to 3.8 percent of GDP this year, from 4.25 percent in previous years, after switching to a new GDP-calculation methodology that raised growth numbers.

Officials have also said they may cut the target by another 0.45 percent of GDP as a result of investment in spending.

The overall budget result BRBUD=ECI, including interest payments, was a surplus of 677 million reais in June as the primary surplus more than covered monthly interest payments on debt.

The result, known as the nominal budget result, compared with a deficit of 7.45 billion reais in May and a deficit of 6.99 billion reais in June last year.

Net public sector debt was equal to 44.3 percent of GDP in June, down from 44.7 percent of GDP in May.

Lopes said the central bank expects net public sector debt to end the year at about 44.5 percent of GDP.

For the central bank text on the budget and debt data, please go to: www.bcb.gov.br/?ECOIMPOLFISC ($1 = 1.87 reais)