Itaú BBA - Sharp correction in external accounts in April

Macro Brazil

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Sharp correction in external accounts in April

mayo 26, 2020

In the coming months, we expect new declines in the current account deficit.


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

 

 The current account posted a USD 3.8 billion surplus in April, beating our estimate (USD 3.2 billion) and market expectations (USD 3 billion). The main surprise vs. our forecast was the service account (equipment rentals and transportation).   

 This was the second consecutive monthly current account surplus. 

 The current account deficit over 12 months narrowed to USD 44.4 billion or 2.6% of GDP (from USD 50.1 billion or 2.9% of GDP).

 Slower economic activity, a weaker exchange rate and increased social isolation impacted the current account, with significant declines in deficits related to international travel, and profits and dividends.

 We expect new declines in the current account deficit in the coming months. We forecast a near-zero balance in the next years.
 

Julia Gottlieb
Thales Caramella


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



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