Economy

Brazil's foreign exchange flow has its 2nd worst year in history

In 2020, the real fell 22.7% against the dollar, in nominal terms, one of the worst performances among the main currencies

Fluxo cambial fica negativo em quase US$28 bi em 2020 e tem 2º pior ano da história. REUTERS/Yuriko Nakao/File Photo
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  • The weak number of 2020 was driven by financial operations – through which flows of loans, remittances of profits and dividends, and portfolio investments, among others –, with a strong outflow of $ 51.173 billion;
  • In the commercial share of this calculation (exchange contracted for export minus import), there was a surplus of $ 23.250 billion.

Brazil ended 2020 with a foreign exchange outflow of almost $28 billion, the second-worst result in history, and the third consecutive year of loss of resources, which helps explain the real last year’s strong devaluation.

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The foreign exchange flow was negative by $27.923 billion, after a breach of $ 44.768 billion in 2019, the year of the greatest disbandment of resources through this channel. In other words, in just two years, the country saw an outflow of $72.691 billion. In 2018, the foreign exchange flow was in deficit of 995 million dollars. The last time the result was positive was in 2017, with a modest surplus of $ 625 million.

The weak number of 2020 was driven by financial operations – through which flows of loans, remittances of profits and dividends, and portfolio investments, among others –, with a strong outflow of $ 51.173 billion. In the commercial share of this calculation (exchange contracted for export minus import), there was a surplus of $ 23.250 billion.

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In December alone, a total of $8.353 billion left Brazil, according to the contracted exchange rate, with outflows in both the commercial account ($-3.932 billion and the financial account ($-4.422 billion).

In 2020, the real fell 22.7% against the dollar, in nominal terms, one of the worst performances among the main currencies.

Translated by LABS