Economic Information

PRESS RELEASE - August 23, 2017

Foreign Sector
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I - Balance of payments - July 2017

In July, the current transactions posted a deficit of US$3.4 billion, accumulating a deficit of US$13.8 billion over the last twelve months, equivalent to 0.71% of GDP. In the financial account, the expansion of liabilities exceeded the expansion of assets by US$3.0 billion, with emphasis on net inflows of US$4.1 billion in direct investments in the country, which totaled US$84.5 billion in the 12-month period ending in July, or 4.37% of GDP.

The service account turned in a deficit of US$3 billion in July, an increase of 31% compared with the same month of the previous year. Net expenditures on international travel totaled US$1.4 billion, growing 60.7% in comparison with July 2016, as a result of expansion of 38% in foreign travelers' expenditures abroad and decline of 5.5% in revenues generated by tourism on Brazil. The equipment rental account showed a deficit of US$1.1 billion in July, down 26.2% compared with the same month of the previous year.

Net primary income expenditures reached US$6.6 billion in the month, increasing 6.3% compared with July 2016. Net expenditures on interests totaled US$4.5 billion, falling by 1.6% when compared with the same month of the previous year. Net remittances of profits and dividends totaled US$2.1 billion in the month, up 28.9% from July 2016.

In the month, the secondary income account registered net inflows of US$144 million, decreasing by 36.2% compared with July of the previous year. Personal transfers sent abroad exceeded those received from abroad by US$2 million.

Net flows of direct investments abroad amounted to US$502 million in the month, and US$1.4 billion in the period from January to July, compared with US$6.6 billion in the same period in 2016.

Net inflows of direct investments in the country amounted to US$4.1 billion in the month (US$2.6 billion in equity capital participation and US$1.5 billion in intercompany operations), and US$40.4 billion in the period from January to July 2017, an increase of 18.6% compared with the same period of 2016.

Portfolio investments - liabilities registered net inflows of US$3.7 billion in the month, including net investments of US$1.6 billion in domestic fixed-income securities and US$2.2 billion in shares and investment funds. Securities traded on the foreign market registered net amortizations of US$282 million in July.

Other investment - liabilities posted net amortizations of US$223 million in July, including net inflows of US$1.5 billion in trade credits and advances and net amortizations of loans worth US$1.4 billion.

II - International reserves

In July, with the return of US$1.2 billion to the Central Bank, and the zeroing of repurchase lines, international reserves totaled US$381 billion, according to both the liquidity concept and the cash concept. Contributions to the stock increase came from earnings on reserves, US$330 million, and variation in prices and parities, US$130 million and US$2.1 billion, respectively.

III - External debt

The estimated gross external debt for July 2017 totaled US$306.1 billion, falling by US$8.2 billion compared with the March 2017 stock. The estimated long-term external debt reached US$259.9 billion, falling by US$1.8 billion, while the short-term debt totaled US$46.2 billion, a decrease of US$6.3 billion in the same period.

Among the factors underlying the long-term external debt variation in the period, it should be highlighted disbursements of securities by the financial sector, US$1.3 billion, amortizations of loans to other sectors, US$3.7 billion, and of government bonds, US$763 million, and an expansion due to the exchange variation, US$1.3 billion. With regard to the short-term debt, it is noteworthy the amortizations of loans by the financial sector, US$5.2 billion, and by other sectors, US$1.3 billion.