Brazil: Latin America Local Bond Preview

Brazil's current account surplus narrowed more than expected in October as imports rose because of a strengthened currency, the central bank said. The current account, the broadest measure of trade in goods and services, had a surplus of $1.53 billion last month, compared with a surplus of $2.28 billion in September and $879 million in October 2005, the central bank said in a report distributed in Brasilia yesterday. A Bloomberg survey of 13 economists had a median estimate of $1.9 billion surplus.

Brazilian retail sales rose in September at their fastest pace in 21 months, as a stronger real and higher wages prompted consumers to buy more imported goods. Retail, supermarket and grocery store sales, as measured by units sold, jumped 10 percent in September from a year earlier, compared with a 6.3 percent gain in August, Brazil's statistics agency said Nov. 17 in Rio de Janeiro. The gain, the most since sales rose 11 percent in December 2004, topped the median 5.9 percent forecast in a Bloomberg survey of 15 analysts.

The yield on Brazil's benchmark zero-coupon, local-currency bond due January 2008 was unchanged at 13.07 percent, according to Banco Pactual.

(Published by Bloomberg, November 21, 2006)