Brazil Flash: ‘Until when will the current account deficit remain stable?’

Summary

The current account deficit was equal to 2.1% of GDP in August, within the 2.1%-2.3% range it has been since the middle of 2010. The expansion of the deficits in both income and services accounts have been offset by a strong trade balance (thanks to high terms of trade). We expect this deficit to move out of the recent range next year: in our base scenario it should reach 2.9% of GDP by the end of 2012.

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