Brasília – The Brazilian Central Bank (BC) revised up its forecast for the current account deficit from USD 15 billion to USD 18 billion. The amount should be equivalent to 1% of the Gross Domestic Product (GDP). The previous estimate was 0.84% of the GDP. The quarterly forecasts were released this Monday (26) by the BC.
The forecast for the trade surplus went from USD 50 billion to USD 49 billion. The services deficit estimate went up from USD 28.3 billion to USD 29.9 billion. Regarding the primary deficit, the forecast was revised up from USD 39.7 billion to USD 39.9 billion. The BC kept unchanged its forecast for foreign direct investments (FDI) in USD 70 billion.
Brazil’s external accounts ended August with a USD 579 million deficit, according to the BC. It is much lower than the one registered in the same month in 2015 at USD 2.592 billion. The result was the best for an August since 2007, when the month registered a surplus of USD 1.233 billion.
From January to August of this year, the country’s external sector has a deficit of USD 13.119 billion against USD 46.164 billion in the same period of 2015.
In August’s current account results, the primary income account (profit and dividends, interest and wage payments) had a deficit of USD 2.508 billion. Services (international travel, transport, equipment leasing, and insurances, among others) contributed USD 2.202 billion to the deficit.
The secondary income account (income generated in one economy and distributed in another, like donations and dollar remittances with no corresponding services or goods) had a surplus of USD 214 million.
The trade balance contributed to reduce the current account deficit with a USD 3.918 billion surplus.
Last month, Foreign Direct Investment totaled USD 7.208 billion, more than enough to compensate the current account deficit. From January to August, these investments totaled USD 41.101 billion, a much higher amount than the year-to-date current account deficit.
In August, Brazil also registered a total of USD 1.511 billion in outward investment in shares traded in domestic and foreign stock markets and via investment funds. In the first eight months of the year, there was an inflow of USD 7.422 billion. Last month, the net outflow of investments in bonds traded in the country was USD 3.834 billion, with the results from January to August at USD 15.551 billion.
*Translated by Sérgio Kakitani
