By Lise Alves, Senior Contributing Reporter
SÃO PAULO, BRAZIL – The balance of payments in Brazil closed positive in April, with current accounts totaling US$1.153 billion, the best result for the month since 2007. For the country’s Central Bank (CB) not even the latest political turmoil will derail the country’s economic recovery.
“With the event last week, we have increased uncertainties, but the message is that the Central Bank acts to maintain the smooth functioning of the market,” said Central Bank’s Economic Department Deputy Chief, Fernando Rocha.
According to data released on Tuesday by the entity, the current accounts registered a surplus, influenced by the positive trade surplus for April. In the twelve months ending in April, however, current accounts recorded a deficit of US$19.8 billion, equivalent to 1.06 percent of GDP.
The services account came in as expected according to BC officials, registering a deficit of US$2.5 billion in April while international travel expenses totaled US$908 million, an increase of 50.9 percent compared to April 2016.
In the financial account, foreign direct investments inflows totaled US$5.6 billion during the month, accumulating US$84.7 billion in the last twelve months, or 4.50 percent of GDP. In the first four months of the year, foreign direct investment inflows totaled US$29.530 billion.
According to Rocha the political turbulence that has shaken the Temer Administration since last week, is unlikely to significantly affect foreign investors’ plans and the Central Bank forecasts the continuity of foreign direct investment inflow into the country.
“For the coming periods, direct investment is expected to continue to be the main source of financing for the current account deficit,” said the Central Bank official.