I - Balance of payments - May 2016
In May, the current account posted a surplus of US$1.2 billion, accumulating a deficit of US$29.5 billion over the previous twelve months, corresponding to 1.70% of GDP. In the financial account, net outflows exceeded net inflows by US$1.7 billion, highlighting net inflows of US$6.1 billion under direct investments into Brazil, and net outflows of US$5.3 billion under fixed-income securities traded on the domestic market.
The service account registered net expenditures of US$2.5 billion in the month, a decline of 25.7% as compared to May 2015, whereas net expenditures on transportation decreased by 59.8%, totaling US$187 million. The item international travel posted net expenditures of US$679 million, falling by 32.0%, on the same comparison basis, reflecting an increase of 4.1% under foreign travelers' expenditures in Brazil and a decrease of 21.3% under Brazilian tourists' expenditures abroad. Net expenditures on equipment rentals fell by 16.3% when compared to May 2015.
Primary income net expenditures totaled US$2.8 billion in the month, increasing by 5.1% compared with the same period of the previous year. Net expenditures on profits and dividends totaled US$1.7 billion, falling by 12.3% against May 2015, reflecting respective declines of 39.4% and 16.9% under revenues and expenditures; while net expenditures on interest totaled US$1.1 billion, up by 43.6% in the same comparison basis. Net outflows related to income on direct investments totaled US$2.0 billion, increasing by 12.1% when compared to the same month of the previous year. Net expenditures regarding income on portfolio investments totaled US$557 million, comprising net expenditures on profits and dividends, US$150 million; interests on securities traded on the foreign markets, US$266 million; and on the domestic market, US$141 million. Net expenditures regarding income on other investments reached US$556 million, increasing by 79.7% in the same comparison basis, while income from earnings on reserves grew by 19.9%.
The secondary income account posted net inflows of US$273 million in May 2016. Gross revenues related to personal transfers reached US$106 million in the month, 3.6% above the result from the same month of the previous year.
Direct investments abroad grew by US$3.3 billion in the month, concentrated in equity capital participation and including reinvestment of earnings.
Net inflows of direct investments in the country reached US$6.1 billion, of which US$5.4 billion in equity capital participation, including US$796 million from reinvestment of earnings, and US$710 million from intercompany transactions. Over 12 months, net inflows of direct investments into Brazil totaled US$79.4 billion, corresponding to 4.57% of GDP.
The return of portfolio investment assets into Brazil reached US$202 million in the month, of which US$130 million corresponding to investment funds.
Portfolio investment - liabilities posted net outflows of US$6.8 billion in May, compared with net inflows of US$3.1 billion in the same month of the previous year. Investments in stocks posted net outflows of US$883 million, while investment funds turned in net inflows of US$227 million. It is worth highlighting net outflows of fixed-income securities, US$6.1 billion, comprising net expenditures of US$5.3 billion in securities traded on the domestic market; and US$839 million in securities traded on the international market.
Other investment - assets fell by US$3.8 billion, comprising a decline of US$8.5 billion in deposits held by Brazilian banks abroad, and an expansion of US$644 million in deposits held by nonfinancial companies, coupled with an increase of US$3.6 billion in trade credits and advances.
Other investment - liabilities posted net inflows of US$1.8. Trade credits and advances grew by US$2.5 billion, mainly resulting from short-term transactions. Net amortizations of long-term loans reached US$677 million, while net amortizations of short-term loans totaled US$139 million in May.
II - International reserves
International reserves according to the liquidity concept totaled US$374.6 billion in May, falling by US$2.1 billion as compared to the previous month. The stock of repurchase lines reached US$11.2 billion, decreasing by US$3.3 billion as compared to April 2016. Income regarding earnings on reserves totaled US$256 million in May, while price and parity variations accounted for respective decreases of US$344 million and US$2.2 billion in the debt stock. In the cash concept, the stock of reserves reached US$363.4 billion in May, increasing by US$1.2 billion compared to the previous month.
III - External debt
The estimated gross external debt for May 2016 totaled US$331.4 billion, decreasing by US$3.2 billion compared to the amount estimated for March 2016. The estimated long-term foreign debt reached US$270.9 billion in May, decreasing by US$2.4 billion, while the short-term debt totaled US$60.5 billion, decreasing by US$831 million, both compared to March.
Among the factors underlying the long-term external debt variation over the period, items worth highlighting are the amortizations of bank loans and debt securities, US$1.1 billion each; in addition to a reduction of US$270 million consequent upon exchange rate variation, and increase in price securities, US$532 million. The variation of the short-term external debt in the period is mainly explained by amortizations of loans taken by financial and nonfinancial sectors, US$529 million and US$346 million, respectively.