Nov. 9 (Bloomberg) -- Brazil’s current account deficit may almost double in 2010 and reach the widest since 1998 as a local currency rally boosts imports amid a consumer-led economic recovery, a central bank survey shows.

The gap will widen to $33.25 billion next year from an estimated $16.9 billion in 2009, according to the median forecasts from about 100 economists in a weekly central bank survey published today. Economists have raised their 2010 deficit estimates for the fourth week from $25 billion Oct. 9.

Imports surged 24 percent in October from January as the real gained 36 percent, the world’s best-performing major currency against the U.S. dollar this year. Record-low interest rates and tax cuts are helping fuel domestic demand in Latin America’s largest economy. New vehicle registrations rose 23 percent in October from a year ago after jumping 29 percent in September, the carmakers association said today.

“Historically, when imports rise in Brazil, they go through the roof,” said Vladimir Caramaschi, Credit Agricole’s strategist in Brazil, in an interview at the Bloomberg office in Sao Paulo.

Brazil’s economy will expand 4.8 percent in 2010 after stalling this year, according to the same central bank survey.

The real gained 0.9 percent to 1.7048 per dollar at 9:07 a.m. in New York, the strongest since Oct. 26.

‘Robust’

A current account gap of $33.25 billion in 2010 would almost match the $33.41 billion deficit Brazil had in 1998, the year before the nation was forced to devalue by abandoning a currency peg designed to help fight inflation. The 1998 deficit was the widest since records began in 1947, according to central bank data. The gap may reach $40 billion next year, Caramaschi said.

The widening deficit won’t weaken the real because Brazil’s reserves are “robust,” said Andre Perfeito, an economist with Gradual Investimentos in Sao Paulo. Foreign currency reserves have risen by $27.1 billion this year to $233.24 billion on Nov. 5.

“Our reserves are very robust, the deficit can be financed,” he said in a phone interview.

International reserves may “soon” climb to $300 billion, President Luiz Inacio Lula da Silva told the Financial Times in an interview published today. He didn’t provide a timeframe.

To contact the reporter on this story: Camila Fontana Correa in Sao Paulo at cfontana@bloomberg.net.

Last Updated: November 9, 2009 09:20 EST