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Friday, February 01, 2008

Brazil Trade Surplus January 2008

Brazil's trade surplus narrowed to a 5 1/2-year low in January as a cheaper dollar and rising consumer demand pushed imports to a record high. Imports increased to $12.3 billion in January from $10.6 billion in December, according to the Trade Ministry today. Exports fell to $13.3 billion in January from $14.2 billion in December.

Brazil's real has appreciated 20 percent against the dollar in 12 months, the best performance among the 16 most-actively traded currencies. The cheaper dollar coupled with the fastest economic expansion since 2004 has boosted demand among Brazilian consumers for imports.

At the same time we learn that coffee exports from Brazil, which is the world's biggest producer, fell 11 percent in January from December, according to Brazil's Coffee Exporters Council.

Brazil shipped 1.81 million bags of coffee beans last month, compared with 2.03 million bags a month earlier, the council, known as Cecafe, said today in a preliminary report.

``The situation can deteriorate if the global economy slows,'' Agostini said.

Brazil's monthly imports exceeded $10 billion for the first time ever in July and have since remained above this threshold.

Agostini expects the country's annual surplus to narrow to $30 billion this year from $40 billion last year.

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