* Brazil posts current account gap of $3.953 billion in June
* Foreign direct investment rises to $7.17 billion
* FDI unlikely to cover large current account gap this year
BRASILIA, July 23 Brazil's current account
deficit narrowed in June from a year ago, central bank data
showed on Tuesday, although the Latin American giant may still
be unable to cover that gap this year with direct investment
The country posted a current account gap of
$3.593 billion in June, below an expected deficit of $4.8
billion, according to the median forecast of 13 analysts in a
Reuters survey. The forecasts for the projected deficit ranged
from $5.6 billion to $4.2 billion.
In June 2012, Brazil had a deficit of $4.4 billion. The
current account is a country's broadest measure of foreign
transactions encompassing trade, profit remittances, interest
payments and other items.
So far this year, the country has accumulated a current
account gap of $43.478 billion, well above the $25.244 billion
posted in the same period a year ago.
That widening gap also helps explain the Brazilian
currency's sharp depreciation over the last few months, which
was exacerbated by expectations of a scale back in U.S. monetary
stimulus that triggered an exodus of capital from
Although foreign direct investment in the
country jumped to $7.17 billion in June from $3.88 billion in
May, it will still fall short of what is needed to cover the
current account gap this year. In the first six months of the
2013, the country received $30 billion in FDI.
Last month, the central bank revised up its current account
deficit estimate for the year to $75 billion, acknowledging for
the first time in years that FDI is unlikely to cover that gap.
The bank expects FDI to reach $65 billion in 2013.
Still, the central bank has said other dollar inflows will
easily help cover the remaining deficit.
In the 12 months through June, the current account deficit
was equivalent to 3.17 percent of gross domestic product, down
from 3.2 percent in May.
A fall in the price of some Brazilian exports plus a hefty
bill for imported fuel has led Brazil to accumulate a trade
deficit of nearly $3 billion this year.