Brasília – The expectation of financial market analysts regarding the dollar-tor-real ratio by the end of the year has been revised downward from 1.75 to 1.70 real to one dollar, according to the Focus bulletin, disclosed today (18th) by the Brazilian Central Bank. For late 2011, the projection has remained at 1.80 real to one dollar for four weeks now.
The dollar appreciated by 0.18% and was equivalent to 1.666 real as of last Friday (15th). Over the last few days, the real has been appreciating against the dollar. To the Brazilian minister of Finance, Guido Mantega, the reason for that is the strong inflow of dollars into the country as a result of Petrobras’ fundraising operation.
On Friday, Mantega claimed that the government may announce new measures to curb the real’s over-appreciation. For the time being, however, the minister believes that it is important to keep track of the effects of measures already adopted, such as the increased Tax on Financial Operations (IOF, in the Portuguese acronym) for fixed income investment by foreigners, and greater space for the National Treasury to purchase dollars in order to pay instalments of the Brazilian foreign debt.
The Focus bulletin also includes the forecast for the trade surplus (positive result for exports minus imports), which has remained at US$ 15.85 billion this year, and has been revised downward US$ 9.5 billion to US$ 9 billion for 2011.
The projected deficit in current transactions (purchase and sale of goods and services between Brazil and foreign countries) for this year remains at US$ 50 billion. For 2011, the estimated deficit has gone from US$ 61.48 billion to US$ 62 billion.
The expected foreign direct investment (funds invested in the country’s productive sector) remains at US$ 30 billion for this year. For 2011, the projection has gone from US$ 37 billion to US$ 38 billion.
*Translated by Gabriel Pomerancblum
