Brazil: Current account deficit narrows in August

In August, the current account balance registered a deficit of USD 2.5 billion, which was a notable improvement from the USD 6.9 billion deficit recorded in the same month last year. In addition, the gap was narrower than market analysts’ expectations of a USD 3.5 billion deficit.

The trade balance registered a surplus of USD 2.7 billion in August, which was above July’s 2.4 billion surplus and an improvement from the USD 1.2 billion surplus recorded in August 2014. Brazil tallied a trade deficit in 2014 for the first time in 14 years on the back of a sharp decline in the value of key exports.

The moving 12-month current account deficit recorded USD 84.5 billion in August, which was an improvement over July’s USD 88.9 billion deficit. August’s figure is equivalent to approximately 4.3% of GDP.

LatinFocus Consensus Forecast participants expect a current account deficit of 4.0% of GDP in 2015. For 2016, panelists expect the current account deficit to be 3.6% of GDP.