Brazil’s current account deficit has continued to widen and is likely to reach around 4.0% of GDP by year-end. Financing this should be manageable, provided the domestic policymaking backdrop doesn’t deteriorate (further) and commodity prices do not fall sharply. A key risk is that waning investor confidence (e.g. due to fiscal concerns) triggers renewed portfolio outflows, putting pressure on Brazilian assets.
Subscriber content
Read this in full, free
Start a free trial and use one of your 10 free starter credits to unlock this piece.