Summary
A more negative external accounts scenario in June was observed last month.
Current transactions (US$ -843 million) are weaker than expected by us and the market (-2.5% of GDP). The surprise to the downside is mainly explained by the Trade Balance of goods (US$ 8.6 billion vs est. US$ 9.7 billion) and by the Remittances of Profits and Dividends (US$ -3.8 billion vs est. US$ -3.2 billion).
Moreover, the previous month was revised downward, from US$ 649 million to US$ 337 million – bringing the 12-month deficit to US$ 50 billion.
FDI
FDI also surprised to the downside (4.0% of GDP). Although we already expected a smaller inflow than the market, there was a flow of only US$ 1.9 billion in the month. The composition was more favorable, with US$ 3.7 billion in Capital Participation, but only US$ 432 million were ex-reinvested profits.
FDI was US$ 2.1 billion – accelerating compared to May (US$ 1.5 billion) – but only US$ 1.4 billion were ex-reinvestments.
Portfolio Investment
Regarding Portfolio Investment, the highlight was the increase in Fixed Income (US$ 4.4 billion) in the foreign portfolio.
More positive news comes from the Rollover Rate (127%), which generated a US$ 888 million inflow in June.
