UPDATE 1-Brazil current account gap widens in November, FDI dips

Tue Dec 18, 2012 7:55am EST

Related Topics

* Brazil posts larger-than-expected $6.265 bln c/a deficit
    * Foreign direct investment falls to $4.59 bln in Nov
    * Central bank sees wider current account gap in 2013


    BRASILIA, Dec 18 (Reuters) - Brazil's current account
deficit widened slightly more than expected in November,
according to the central bank, which on Tuesday also forecast
that the deficit would swell in 2013.
    Brazil posted a current account deficit of
$6.265 billion in November, larger than the median forecast of
$6 billion in a Reuters poll of 19 economists.
    Brazil's current account deficit, a broad measure of a
country's foreign transactions including trade in goods and 
services but also profit remittances and interest payments, had
totaled $6.64 billion in November of last year.   
    The current account deficit in October was $5.431 billion,
the central bank said last month.
    Foreign direct investment, which falls into the capital
account of the balance of payments, was $4.587 billion in
November, down from $7.73 billion in October but more than the
expected $3 billion.
    A strong flow of foreign investment in Brazil despite the
weak global economy has so far helped cover the country's
current account gap this year. 
    Brazil posted an unexpected trade deficit of
$186 million in November as exports slowed faster than imports,
despite a nearly 11 percent drop in the country's currency, the
real against the dollar, so far this year. 
    The central bank also published its forecasts for Brazil's
balance of payments in 2012 and 2013. Brazil's current account
deficit should widen to $65 billion next year, matching the
expected foreign direct investment for the period.    Below are
the central bank forecasts for Brazil's balance of payments in
2012 and 2013: 
            
 ($ bln)                   2012                    2013
                           previous  new forecast  forecast
                           forecast                
 Current account deficit       53.0          52.5      65.0
 FDI                           60.0          63.0      65.0
 Trade balance                 18.0          19.0      17.0
 Profit remittances            24.0          23.7      30.0
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