BRASILIA, Jan 24 (Reuters) - Foreign direct investment flows failed to cover Brazil’s current account gap for the first time in more than a decade, central bank data showed on Friday, evidence of the country’s worsening balance of payments.
Brazil posted a current account deficit of $8.678 billion in December, a much bigger gap than market expectations of a deficit of $6.8 billion, according to the median forecast of 16 analysts in a Reuters survey.
Brazil’s current account deficit surged to $81.374 billion in all of 2013, the biggest gap since at least 2001. Last year the country had an external gap of $54.249 billion.
Meanwhile, Brazil attracted $64.045 billion in foreign direct investment in 2013, down from $65.272 billion in 2012.
A weakening trade balance, rising travel expenses and a steep repatriation of profits abroad drove up the country’s current account deficit this year.
Officials have said the commodities powerhouse can easily cover its external gap with investment in debt and stocks plus more than $375 billion in foreign reserves.
Foreign direct investment in Latin America’s largest economy was $6.490 billion in December, above market expectations of $5.5 billion.
Foreign investment has remained steady in Brazil despite a sharp economic slowdown since mid-2011, as investors see more opportunities in the South American giant than in a recession-hit Europe or a slowly recovering United States.