Brazil posted a trade surplus in November that was more than five times expectations, official data showed, but even so the country remained on track to end the year with its first annual deficit in more than a decade.
The trade surplus of $1.740 billion was well above expectations for a $300 million surplus, according to the median forecast of 16 analysts surveyed by Reuters. In November 2012, the country posted a trade deficit of $193.6 million.
So far this year Brazil has accumulated a deficit of $89 million, a sharp contrast from the $17.154 billion surplus posted during the same period last year.
Brazilians’ appetite for foreign products has remained strong, bolstering imports of items from shoes to electronics and clothes. In the first 11 months of the year, imports rose 7.1 percent while exports dropped 1.1 percent from the same period last year.
Though exports make up only about 10 percent of Brazil’s $2.5 trillion economy, they are considered a key sector by President Dilma Rousseff’s government.
Rousseff has offered billions of dollars in subsidized lending to help exporters, mostly those who produce manufactured goods.
The widening trade deficit is a serious challenge for Brazil, which is reeling from a sluggish global economy and productivity shortcomings at home. The deficit is also helping weaken the local currency, the real, as fewer U.S. dollars enter the economy. (Reuters)