Brazil: Current account deficit widens in July
August 27, 2018
Brazil’s current account balance came in at a deficit of USD 4.4 billion in July, a deterioration from the USD 3.4 billion shortfall recorded in the same month last year. July’s result marked the first deficit since February.
The wider current account deficit was primarily due to a lower trade balance, which came in at surplus of USD 4.2 billion in July (July 2017: USD 6.3 billion). Soaring import growth was chiefly behind the weaker trade surplus due to record high imports of oil platforms under the special customs program Repetro. Meanwhile, foreign direct investment came in at USD 3.9 billion in July, below July 2017’s USD 4.1 billion.
As a result, the 12-month accumulative current account deficit widened in July to USD 15.0 billion from June’s USD 14.0 billion deficit. July’s result represented approximately 0.8% of GDP.
Brazil Current Account Balance Forecast
Analysts who participated in this month’s LatinFocus Consensus Forecast expect a current account deficit of 0.9% of GDP in 2018. For 2019, panelists expect the current account deficit to widen to 1.5% of GDP.