Brazil: Current account deficit nearly halves in 2015
January 26, 2016
Brazil’s current account deficit declined notably last year, coming in at USD 58.9 billion for 2015. The result was nearly half of 2014’s deficit of USD 104 billion, and is equivalent to approximately 3.3% of GDP. The improvement was mainly driven by a turnaround in the trade balance, which tallied a deficit in 2014 for the first time in 14 years. Current account data has been a bright spot for Brazil this year, as the country grapples with recession and high inflation levels.
In December, the current account balance registered a deficit of USD 2.5 billion, which was a notable improvement from the USD 8.6 billion deficit recorded in the same month of the previous year. In addition, the gap was in line with market analysts’ expectations.
The trade balance registered a surplus of USD 6.2 billion in December, which was notably above November’s 1.2 billion surplus and December 2014’s meagre 300 million surplus. In addition, the result marked the largest surplus in over a decade, although the result came on the back of an over 30.0% year-on-year decline in imports. Imports have tallied double-digit contractions for nine months amid subdued demand and a weak real.