BRASILIA, Sept 24 Brazil's current account
deficit widened in August to $5.505 billion from
the same month a year ago as the country's trade surplus shrank
rapidly, central bank data showed on Tuesday,
A widening current account deficit is likely to increase
Brazil's borrowing needs and the cost of credit as well as hit
The country had been expected to post a deficit of $5.1
billion for August, according to the median forecast of 23
analysts in a Reuters survey. The country had a current account
deficit of $2.55 billion in August 2012.
It reported a current account deficit in July of $9.018
Brazil, a major producer of meat, soy and iron ore, has seen
its exports dwindle this year on tepid demand abroad and a drop
in the value of commodities. Imports on the other hand have
remained robust in Latin America's largest economy.
The central bank revised down its estimates for the
country's trade surplus in 2013 to $2 billion from $7 billion
Foreign direct investment in Latin America's
largest economy was $3.775 billion in August, above market
expectations of $3.5 billion.
In the 12 months through August, the current account
deficit was equivalent to 3.6 percent of gross domestic product,
up from 3.46 percent in July.
Central bank chief Alexandre Tombini said earlier on Tuesday
that the current account deficit was "manageable" and that he
expects it to fall to back to around 3 percent of GDP.