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Brazil Posted First Trade Gap in 10 Months on Export Drop

Dec. 3 (Bloomberg) -- Brazil posted its first trade gap in 10 months in November as exports to the country’s top trading partners plunged amid slower global growth.

The trade deficit was $186 million last month, compared with a $571 million surplus a year earlier, the Trade Ministry said in a report published today on its website. Economists forecast a surplus of $500 million, according to the median estimate from 21 analysts surveyed by Bloomberg.

Exports fell to $20.5 billion from $21.8 billion last November, lower than the median forecast of $21 billion in a Bloomberg survey of 12 analysts. Shipments to China declined 19.7 percent over the same month a year ago, while exports to the U.S. and Argentina fell 24.1 percent and 24.4 percent, respectively. Imports fell to $20.7 billion, from $21.2 billion.

Since 2010, Brazil’s government has introduced measures such as taxes on capital inflows to weaken the real, in a bid to protect domestic manufacturers. The real has fallen 12.1 percent this year, the worst performance among the 16-most traded currencies tracked by Bloomberg.

“This deficit has to do with a slowdown in the global economy,” Newton Rosa, chief economist at Sul America Investimento, said in a telephone interview from Sao Paulo. “We will most likely have a surplus in December because of seasonal reasons.”

Global, Domestic Growth

Global economic growth will slow for the second straight year to 2.2 percent this year from 2.9 in 2011, according to the median forecast of analysts surveyed by Bloomberg.

Even as authorities try to revive the world’s second-largest emerging market, Brazil’s gross domestic product in the third quarter expanded at half the pace forecast by economists. After growing 7.5 percent in 2010 and 2.7 percent last year, Brazil’s economy will grow 1.27 percent this year, according to the latest central bank survey of about 100 economists.

Swap rates on the contract maturing in January 2014, the most traded in Sao Paulo today, fell four basis points to 7.17 percent at 5:44 p.m. local time. The real rose 0.5 percent to 2.1244 per U.S. dollar.

To contact the reporters on this story: Matthew Malinowski in Brasilia Newsroom at mmalinowski@bloomberg.net; Maria Luiza Rabello in Brasilia Newsroom at mrabello@bloomberg.net

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net

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