Foreign direct investment into Brazil came in December at more than twice the amount estimated by analysts, as a weakening currency and declining asset prices triggered a jump in merger and acquisition activity at the end of last year. FDI, as the indicator is known, rose to $15.211 billion last month, the central bank said in a report on Tuesday. The number topped a median estimate of $6.5 billion in a Reuters poll of economists.
The current account, the most comprehensive gauge of trade flows, posted a deficit of $2.46 billion in December, slightly below the $2.5 billion that economists estimated in the poll. Last year, the shortfall totalled $58.942 billion. A sinking economy mired in its worst recession since at least 1990 has hit demand for imports while a weaker currency helped local exporters sell more abroad.
That combination has reduced the current account gap to its smallest since at least 2010, at $58.942 billion last year versus $104.181 billion in 2014. Foreign direct investment also fell in the year but by 29 percent to $75.075 billion. In the 12 months through December, the deficit was equivalent to 3.32 percent of Brazil's gross domestic product, down from 3.72 percent of GDP the previous month.