BRASÍLIA: Brazil’s current account continues to rebound in subdued imports. The sharp rebound in the trade balance in November leads to an estimated current account surplus of USD 1245 million in December, according to a Societe Generale research report. But, the rebound in the trade and current account balances continues to indicate a subdued domestic demand growth in recent months because of the improvement in prices of commodity.
If there is a further rebound in commodity prices, the current account is expected to see continued improvement. But, in general, the rebound in current account balance is likely to come to a halt in the next few months. “We currently forecast the CAB/GDP ratio at -1.3 percent for 2016 followed by -1.2 percent for 2017”, added Societe Generale. The continued low growth shows some upside risk to this forecast of the current account balance stabilizing at around current level.
