Brazil Central Bank forecasts more growth in May foreign accounts
The surplus in current transactions—i.e. sales and purchases of goods and services as well as income transfers between the country and the world—is estimated to total $1.5 billion
Brazil's foreign accounts are expected to register the third consecutive positive result in May this year. The surplus in current transactions—i.e. sales and purchases of goods and services as well as income transfers between the country and the world—is estimated to total $1.5 billion. According to figures released Tuesday (May 23), the balance stood at $1.153 billion in April.
The result is expected by the Central Bank despite the political crisis following the release by newspaper O Globo of part of the testimony by meatpacking giant JBS involving President Michel Temer and ousted Senator Aécio Neves, of the Brazilian Social Democracy Party (PSDB).
“Uncertainties escalated after the incident that took place last week, but the message is that the Central Bank has worked to keep the market operating properly,” said Fernando Rocha, assistant head at the Central Bank Economic Department.
On May 18, the first day of operations in the financial market after the plea bargain statement was made public, more dollars came into the country than left in the commercial and financial segments, adding up to $1.338 billion. On the following day (19), the balance was also positive—$1.124 billion. “During these two days, a positive net value was reported to have come into the domestic exchange market. As for the uncertainties, we are yet to see how this scenario will unfold,” he added.
“It's really difficult to say exactly what is going on on a given day in the exchange market. There was an increase in the exchange rate, which may be favorable to exporters deciding to bring more funds to the country,” Rocha went on to argue.
Foreign investment
Direct foreign investment in the country's productive sector is also expected to continue, Rocha reported. By last Friday this month (19), $1.4 billion was seen to enter the country. The forecast for the whole of May is $2.8 billion. “For the upcoming periods, direct investment is expected to continue as the main source of financing for the deficit in current transactions,” said Rocha.
Translated by Fabrício Ferreira
Fonte: Brazil Central Bank forecasts more growth in May foreign accounts
