* Record trade deficit in January hits current account
* Foreign direct investment falls short of covering gap
* Central banks revises 2013 deficit up to $67 billion
By Alonso Soto
BRASILIA, March 22 Brazil's current account
deficit widened substantially in February from a year earlier as
imports outpaced exports for the second straight month, central
bank data showed on Friday.
The bank revised up its forecast for the current account
deficit in 2013 to $67 billion from $65 billion previously while
maintaining is 2013 foreign direct investment forecast at $65
If the central bank's forecasts prove correct, 2013 would
be the first year since 2001 that FDI will not cover the
Brazil's current account deficit.
Brazil posted a current account gap of $6.6
billion in February, compared with $1.7 billion in the same
month last year and higher than the median forecast of $6.1
billion by 20 analysts surveyed by Reuters. Their forecasts for
the deficit ranged from $3 billion to $7.1 billion.
Brazil's current account deficit in January climbed to a w
record high of $11.37 billion. The 12-month current account
deficit equaled 2.79 percent of GDP through February, the
central bank said.
Foreign direct investment, which is part of the capital
account of the balance of payments, was $3.8 billion in
February, up from a previously reported $3.7 billion in January
and more than the expected $3.5 billion.
In January and February FDI has fallen short of covering
Brazil's large gap in the current account, which encompasses
trade, profit remittances, interest payments and items like
Brazil, a major soybean and iron ore produce. posted a
larger-than-expected trade deficit of $1.276 billion in February
as imports surged to a record high for the month. It had posted
a deficit of $4 billion in January, the largest on record.
Government officials have said the large deficits are due to
accounting changes which tallied billions of dollars of fuel
imports from 2012 in this year's balance and seasonal factors.
However, some say the country's trade balance could remain
under pressure this year as the domestic currency has
appreciated so far this year and robust consumption should keep
demand for imports strong in the South American country.
"Based on our out-of-consensus forecast of a stronger
economy and stronger real in 2013, we believe import values
could surprise on the upside, further reducing the trade
balance," analysts with Nomura Securities said in a research
note published on Thursday.
Below are the central bank forecasts for Brazil's balance of
payments in 2013, billions of dollars:
Current account deficit 65.0 67.0
FDI 65.0 65.0
Trade balance 17.0 15.0
Profit remittances 30.0 30.0