Agência Brasil*
Brasília – Market analysts project that by the end the year the dollar should be worth the equivalent of 1.75 reals, as against the 1.78 reals previously estimated. The dollar has been depreciating against the real (Brazilian currency) for three consecutive weeks now. For the current month, the estimate was revised up from 1.69 real to 1.70 real. The same estimate applied for the month of April. The projections were taken from the Focus bulletin, a weekly publication by the Brazilian Central Bank based on prognoses for the main economic indicators made by 100 financial institutions.
Last week, the federal government launched a set of measures aimed at containing what the minister of Finance, Guido Mantega, referred to as "the melting of the dollar", and at reducing the impact of the dollar depreciation on exports. The measures become effective as of today (17).
Despite the announcement, market analysts have maintained their projection for the balance of trade surplus, i.e. exports minus imports, at US$ 29 billion by the end of the year. The forecast for foreign direct investment (FDI – funds that contribute to the generation of employment) was also maintained at US$ 29 billion in 2008.
However, with regard to the current account surplus, which involves all commercial and financial transactions with foreign countries, the projection of deficit for this year increased from US$ 8.10 billion to US$ 9 billion. For next year, the deficit estimate was maintained at US$ 12.08 billion.
As to the expansion of industrial production, the projection was revised up from 5.04% to 5.06% for this year. With regard to the growth in Gross Domestic Product (GDP), i.e. the sum of all goods and services produced in the country, a growth projection of 4.5% 2008 has been maintained for 12 weeks now. The 4% estimate for 2009 has not been revised either.
*Translated by Gabriel Pomerancblum
