Itaú BBA - Current account deficit reaches $4.4 billion in July

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Current account deficit reaches $4.4 billion in July

August 27, 2018

The current account deficit moderated at the margin in July

For the version with all charts and tables, please open the attached pdf file 
 

The current account posted a $4.4 billion deficit in July, wider than our estimate ($3.6 billion) and market consensus ($3.7 billion). Greater profits and dividends remittances were behind the biggest deviation from our forecast. For the next years, we maintain our expectation of a gradual increase in the current account deficit — in line with somewhat of a rebound in economic activity (reducing the trade surplus) and due to the large stock of foreign investment in the country (which should pressure the profits and dividends line) —, but not to the point of compromising Brazil’s external sustainability. Current data already point in that direction. Direct investment in the country stabilized at a lower level but is still the main source of financing of the current account deficit.

 

Julia Gottlieb

 

For the version with all charts and tables, please open the attached pdf file 



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