Brazil Current Account April 2016


Current account swings to surplus in April

In April, the current account balance registered a surplus of USD 412 million, which marked the best result since September 2008 and notably contrasted the USD 6.8 billion deficit recorded in April 2015. The result was a notable improvement over market analysts’ expectations of a USD 900 million shortfall. In the midst of an onslaught of negative economic data concerning Latin America’s largest economy, the improving current account balance was a bright spot.

The trade balance registered a surplus of USD 4.9 billion in April, which was above March’s USD 4.4 billion surplus and the USD 491 million deficit tallied in April 2015. Although weak external demand is hurting Brazil’s exports, the low value of the real is supporting sales abroad and the abysmal economy has caused import demand to drop.

The moving 12-month current account deficit recorded USD 34.1 billion in April, which was a smaller shortfall than March’s USD 41.4 billion deficit. April’s result is equivalent to approximately 2.0% of GDP.

Analysts who participated in this month’s LatinFocus Consensus Forecast panel expect a current account deficit of 1.4% of GDP in 2016. For 2017, panelists expect the current account deficit to be 1.2% of GDP.

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Brazil Current Account Chart

Brazil Current Account April 2016

Note: Monthly and 12-month current account balance in USD billion.
Source: Central Bank of Brazil (BCB) and FocusEconomics calculations.

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