Brazil's public sector debt edges up to 76.1% of GDP in May

BRASILIA, June 30 (Reuters) - Brazil's public sector gross debt rose slightly to 76.1% of gross domestic product (GDP) in May from 76.0% in April, central bank data showed on Monday.

The increase was driven mainly by interest payments, the central bank said, in a month when the primary budget deficit came in narrower than expected.

Latin America's largest economy paid 92.145 billion reais ($16.82 billion) in nominal interest in May, up 23.9% from the same month last year, reflecting the rise in the country's benchmark interest rate and the growing stock of public debt.

Earlier this month, the central bank raised rates by another 25 basis points to 15%, bringing total tightening to 450 basis points since September in an effort to combat inflation.

The public sector posted a primary deficit, excluding interest payments, of 33.74 billion reais for the month, smaller than the 42.7 billion reais shortfall forecast in a Reuters poll of economists.

Over a 12-month period, the public sector posted a primary surplus of 0.2% of GDP, while interest payments resulted in a deficit of 7.77% of GDP, bringing Brazil's nominal budget deficit to 7.58% of GDP.

($1 = 5.4777 reais)