Brazil: Current account deficit jumps in September
Brazil’s current account balance came in at a deficit of USD 3.5 billion in September, ballooning from the USD 0.2 billion shortfall recorded in the same month of 2018. The result followed the central bank’s revision of historical balance of payments statistics and update to its methodology for calculating some cross-border flows announced in September, which led to notable downward revisions in the current account.
September’s result reflected a sharp deterioration in the trade balance, which came in at USD 1.7 billion in September (September 2018: 4.7 billion). Exports posted another contraction in the month amid subdued demand from key trading partners, while imports recorded the largest expansion in 10 months. Meanwhile, foreign direct investment fell, coming in at USD 6.3 billion in September (September 2018: USD 7.9 billion).
Accordingly, the 12-month trailing current account deficit also deteriorated, coming in at USD 34.1 billion in September (August: USD 34.1 billion). The result is equal to approximately 2.1% of GDP and marks the largest deficit as a percentage of GDP since March 2016.