With exports of USD 34.1 billion and imports of USD 27.1 billion, Brazil recorded a trade surplus of just over USD 7 billion in July. The data were released on Thursday (Aug. 6) by the Ministry of Development, Industry, Trade, and Services.

Trade flow (the sum of exports and imports) totaled USD 61.17 billion during the period, representing a 6.8 percent increase compared with July 2025. Both exports (up 6.2 percent) and imports (up 7.6 percent) rose compared with the same period last year.

Key exported and imported products

Notícias relacionadas:

• Brazil’s Central Bank cuts benchmark interest rate to 14%.
• Second quarter has 5.4% unemployment, lowest ever for the period.
• Aircraft, oil, coffee, beef exempt from tariffs imposed by US.

According to the ministry, agricultural exports increased by 9.3 percent, driven mainly by soybean exports, which were up by approximately USD 870 million. In the extractive industry, crude oil exports rose by USD 960 million, while in the manufacturing sector, fuel oil exports also increased by USD 960 million. In the case of fuels, export growth exceeded 63 percent.

July’s imports were driven mainly by higher purchases of petroleum fuel oils (up USD 500 million), automatic data-processing machines and their units (up USD 320 million), medicines and pharmaceutical products, excluding veterinary products (up USD 320 million), thermionic, cold-cathode, or photocathode valves and tubes, diodes and transistors (up USD 290 million), and ethylene polymers in primary forms (up USD 150 million).

Trading partners

According to July’s trade balance results, China remains Brazil’s main trading partner, accounting for nearly one-third of Brazilian exports last month, with shipments totaling more than USD 10.7 billion - an 8.6 percent increase compared with July 2025.

The United States ranked second, accounting for 10.7 percent of Brazilian exports in July, down 5 percent from the same month in 2025. The decline does not yet reflect the effects of the US government’s new tariff hike, which took effect on July 22 and is expected to affect August sales, with data to be released in early September.

Brazil’s exports to Argentina also fell last month, declining by nearly USD 230 million, or 13.9 percent compared with July of last year. Although not directly related, this development comes at a time of renewed tensions between the governments of the two neighboring countries following successive attacks by Argentine President Javier Milei against Brazilian President Luiz Inácio Lula da Silva. The dispute led Brazil’s Ministry of Foreign Affairs to downgrade diplomatic relations with Buenos Aires.

Year-to-date

From January through July, Brazil’s trade balance recorded a surplus of USD 49 billion, with both imports and exports increasing compared with the same period last year.

Year-to-date figures (January–July 2026):

Exports: USD 218.6 billion (+10.5%)
Imports: USD 169.5 billion (+5.5%)
Total trade: USD 388.1 billion (+8.2%)
Trade balance: USD 49 billion surplus

The fourth consecutive cut in the Selic rate, decided on Wednesday (Aug. 5) by the Monetary Policy Committee (Copom) of Brazil’s Central Bank, was well received by economic agents but is still considered insufficient to support industrial sector growth.

In a statement, the Federation of Industries of the State of Rio de Janeiro (Firjan) emphasized that the ongoing cycle of Selic rate cuts represents a positive sign for economic activity, but that the still-high level of the rate keeps credit expensive and delays investment.

Notícias relacionadas:

• Brazil’s Central Bank cuts benchmark interest rate to 14%.
• Brazil’s Central Bank tightens rules for virtual asset firms.
• Brazilian industry grows 0.7% in April.

“The high cost of capital delays investment, hinders production modernization, and limits Brazilian companies’ ability to improve productivity and compete in domestic and foreign markets. This situation is reflected in the performance of the manufacturing sector, which grew by only 0.4 percent in the first half of the year, according to Brazil’s statistics bureau, the IBGE.”

Along the same lines, the National Confederation of Industry (CNI) noted that interest rates have remained restrictive for 55 months and that the Selic rate is 3.6 percentage points above the level indicated by the Taylor Rule, which estimates an appropriate rate at 10.4 percent. The rule is used to calculate an interest rate that helps control inflation without holding back economic growth.

“The real interest rate, at approximately 10 percent, is well above the equilibrium rate estimated by the Central Bank itself at 5 percent, indicating that there is room for more significant Selic rate cuts without compromising the fight against inflation.”

Among labor organizations, Força Sindical said the 0.25 percentage point cut in the Selic rate was insufficient. According to the labor federation, high interest rates make credit more expensive, curb investment, discourage consumption, and hinder job creation.

“We missed an excellent opportunity to promote a sharp reduction in interest rates, boost confidence in the productive sector, and further stimulate the economy.”

Outlook

Camilo Cavalcanti, a portfolio manager at Oby Capital, assessed that the Monetary Policy Committee maintained its message that the full extent of the interest rate cut cycle will be determined by incoming data, without any prior commitment, and reinforced the asymmetric balance of upward risks.

“At the end of the statement, Copom explicitly cited the de-anchoring of inflation expectations and the elevated risks surrounding the baseline scenario as reasons for ‘calm and caution’ in the conduct of monetary policy. Given the contrast between a more favorable current scenario and forward-looking communication that remains cautious, we assess that Copom is still leaving open the possibility of continuing the cycle of interest rate cuts at its next meeting.”

Copom

The Central Bank’s Monetary Policy Committee reduced the Selic rate - the Brazilian economy’s benchmark interest rate - by 0.25 percentage points, bringing it down from 14.25 percent to 14 percent per year.

This marks the fourth consecutive interest rate cut by the committee. The decision was made at a meeting held at the bank’s headquarters in Brasília.

According to the institution, the new gradual 0.25 percentage point reduction is consistent with the strategy of bringing inflation toward the center of the target range over the coming months.

Regarding the external environment, the Central Bank once again pointed to uncertainty surrounding armed conflicts in the Middle East and the monetary policies of some advanced economies.

The Monetary Policy Committee (Copom) of the Central Bank of Brazil on Wednesday (Aug. 5) cut the Selic rate - the Brazilian economy’s benchmark interest rate - by 0.25 percentage points, from 14.25 percent to 14 percent per year. The decision marks Copom’s fourth consecutive interest rate cut.

The Central Bank uses the Selic rate as a monetary policy tool to slow economic activity and help control inflation.

Notícias relacionadas:

• Brazil’s Central Bank tightens rules for virtual asset firms.
• Brazilian economy grows 0.7% in May, driven by household consumption.
• Food prices decline, official inflation slows to 0.16% in June.

According to the institution, the latest gradual reduction of 0.25 percentage points is consistent with its strategy of bringing inflation back toward the midpoint of the target range.

The inflation target set by the National Monetary Council (CMN) for the period beginning in January 2025 is 3 percent, with a tolerance band of plus or minus 1.5 percentage points - that is, from 1.5 to 4.5 percent.

“Without compromising its primary objective of ensuring price stability, this decision also helps smooth fluctuations in economic activity and foster full employment,” the bank said in a statement.

Regarding the external environment, the Central Bank once again pointed to uncertainty surrounding armed conflicts in the Middle East and the monetary policies of some advanced economies.

“This scenario calls for caution on the part of emerging economies in an environment marked by rising volatility in asset and commodity prices,” the institution noted.

Regarding the domestic outlook, the bank emphasized that the set of indicators released since the previous meeting suggests “a gradual moderation in economic activity, although it remains resilient, with mixed signals across sectors and a tight labor market.”

From June 2025 to March this year, the Selic rate remained at 15 percent per year, reaching its highest level in nearly 20 years.

The Monetary Policy Committee began cutting interest rates in March amid falling inflation. However, the war in the Middle East, which has pushed up fuel and food prices, is making further rate cuts more difficult.