Brazil posts current account surplus in January

www.forbes.com Reuters, 02.20.03, 9:18 AM ET BRASILIA, Brazil, Feb 20 (Reuters) - Brazil posted a current account surplus of $156 million in January, compared with a deficit of $1.17 billion in the same month of 2002, as a bulging trade surplus boosted the country's overall foreign accounts, the Central Bank said on Thursday. That helped shrink the current account gap -- a country's widest measure of foreign transactions -- to 1.41 percent of gross domestic product (GDP) in the 12 months through the end of January from 1.7 percent of GDP in the 12 months through December. Foreign direct investment (FDI) also continued to trickle into the country in President Luiz Inacio Lula da Silva's first month in office, despite growing aversion to emerging markets like Brazil sparked by the threat of war in Iraq. FDI in January totaled $905 million, down from $1.475 billion in the same month a year ago. In 2002, Brazil posted a current account gap of $7.76 billion, its best result in eight years, thanks to a booming trade surplus of $13.1 billion. A weak local currency continues to make Brazil's exports extremely competitive abroad. For 2003, the bank is forecasting a current account deficit of $6.56 billion.