Brazil's external debt has risen substantially over the past couple of years

Brazil's external debt environment is not bad when seen in comparison to other EM countries, the deteriorating fiscal situation and the depreciating currency could soon raise the debt/GDP rate to a much higher level. In fact, external debt rose sharply in Q2 2014 and has continued to rise. 

Given the current pace of the rise in public debt and currency depreciation, the external debt position to GDP ratio could increase sharply over the next couple of years. That said, short-term debt still constitutes a very minor proportion of the total external debt and the Brazilian FX reserves are still healthy when compared with the short-term external debt position.