S&P Global Ratings affirmed Brazil's long‑ and short‑term sovereign credit ratings at BB/B on the day of the announcement, maintaining a stable outlook for the long‑term rating and leaving the transfer and convertibility assessment at BBB‑. The agency highlighted that Brazil's strong external position—driven by robust agricultural and energy commodity exports, a floating and actively traded real, and sizable international reserves—helps mitigate the impact of fiscal weakness. S&P expects Brazil's general‑government primary deficit to hover around 7% of GDP over the next several years unless decisive steps are taken to reduce budget rigidity and generate larger primary surpluses. Net general‑government debt is projected to increase to approximately 74% of GDP by 2029, up from 60.4% of GDP in 2025, while the interest burden on general‑government revenue is anticipated to average about 20% for the 2025‑2028 period. Real GDP growth is forecast at 1.8% for 2026, down from 2.3% in the prior year, with an average growth rate of 3.2% recorded over 2022‑2024 and an expected rise toward 2.2% by 2028, constrained by persistently high real interest rates despite positive trends in agriculture and hydrocarbons. The rating outlook could be downgraded within two years if policy decisions exacerbate fiscal deficits or if inaction worsens government financing conditions. Conversely, a rating upgrade is possible if policy initiatives deliver robust economic growth and higher primary balances, which would require a more flexible budget structure. Brazil is approaching national elections in October 2026, with incumbent President Luiz Inacio Lula da Silva identified as the front‑runner for a second consecutive term. The reaffirmation underscores S&P's view that Brazil's deepening domestic financial markets continue to facilitate financing for both public and private sectors, providing a buffer against external shocks.