Brazil Raises $3.25 Billion in Sovereign Bond Deal, Marks Busiest Dollar Sale Since 2014

Brazil has been highly active in international debt markets in 2025, conducting its busiest year for dollar bond sales since 2014 by issuing a mix of new long-term bonds and reopening existing ones to extend its debt maturity profile. The Treasury's recent two-part bond sale raised $3.25 billion, including a new 30-year note yielding 7.5%, the lowest risk premium for that maturity since 2014, signaling strong investor confidence in Brazil's economic management despite ongoing U.S. tariffs on Brazilian goods. Overall, Brazil has raised over $5 billion in sovereign bonds this year, with demand significantly exceeding supply, reflecting international trust in its fiscal strategy and economic outlook. Major banks such as Bank of America, Itaú BBA, and JPMorgan have been instrumental in facilitating these sales, with nearly 90% of bonds purchased by investors from Europe and North America. This strategic borrowing approach aims to lock in funding on favorable terms to buffer against global market uncertainties, spread out future debt repayments, and provide fiscal flexibility ahead of forthcoming elections. However, challenges remain as Brazil faces slowing GDP growth, sticky inflation, and a high public debt level sensitive to interest rate changes, which have pushed the 10-year government bond yield toward 14.1%.