MercoPress. South Atlantic News Agency

Brazil's current account deficit in 12 months to September stands at 3.6% of GDP

Commodities exports helped with a higher than expected trade surplus in September

Brazil's current account deficit narrowed in September from the previous month as the foreign trade surplus strengthened, but the improvement was more modest than economists expected. The country posted a current account deficit of 2.629 billion dollars in September, central bank data showed.

Brazil's current account deficit in August was 5.505 billion. The current account is a country's broadest measure of foreign transactions encompassing trade, profit remittances, interest payments and other items.

A widening deficit contributed to a sharp depreciation of Brazil's currency between May and August, when global risk aversion spiked on prospects of a change in US monetary policy.

Brazil, a major producer of meat, soy and iron ore, posted a stronger-than-expected trade surplus of 2.15 billion in September. Brazil has seen its exports shrink on tepid demand abroad and a drop in the value of commodities, while imports have remained robust.

In the 12 months through September, the current account deficit was equivalent to 3.6% of GDP, unchanged from August. The country also had a current account deficit of 2.6 billion in September of 2012.

Foreign direct investment in Brazil was 4.770 billion in September.

Central bank chief Alexandre Tombini said earlier this year that the current account deficit was “manageable” and that he expects it to fall back to around 3% of GDP.