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Net Outflow of US$ 8.3 Billion in March Surpasses Record Set in 2020 and Reveals Strong Impact of International Crisis on Brazilian External Accounts, According to Central Bank
March ended with a historic blow to the Brazilian economy. Data released this Wednesday (9) by the Central Bank shows that the country recorded a net outflow of US$ 8.3 billion — the worst result for the month since the start of the historical series, which began in 1982. The last time Brazil saw something similar was in March 2020, at the height of the Covid-19 pandemic.
Financial Channel Leads the Currency Drain
According to the Central Bank report, the outflow of dollars was led by the financial channel, with a departure of US$ 12.8 billion in March. This includes movements such as withdrawal of investments in stocks and bonds, remittance of profits abroad by multinationals, and a decrease in foreign direct investments in the country.
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The financial channel reflects international perceptions of risk, interest rates, and stability — and at this moment, Brazil seems to be losing points in this game.
International Trade Still Holds Part of the Pressure
Despite the financial shortfall, the trade channel, responsible for exports and imports, recorded an inflow of US$ 4.5 billion in March. In other words, the balance of sales of goods and services abroad was still positive, which prevented a greater damage to external accounts.
Even so, the impact of the financial outflow, according to the Central Bank, caused the total balance of the currency flow to turn negative — and significantly so.
Year-to-Date Deficit Exceeds US$ 15 Billion
Adding up the first three months of 2024, Brazil has already accumulated a deficit of US$ 15.8 billion in the currency flow. Of this total, US$ 23.1 billion left through the financial channel, while US$ 7.3 billion came in through the trade channel.
This imbalance, according to the Central Bank itself, is a direct reflection of global instability exacerbated by Trump’s “tariff hike” against Brazilian steel and aluminum, which generated insecurity among international investors.
Dollar Dropped, But the Climate is One of Uncertainty
Interestingly, even with the outflow of dollars, the U.S. currency dropped 3.51% in March and 7.63% in the quarter, trading this Wednesday (9) at R$ 5.84 — an immediate reaction to the partial pause in American tariffs announced by Trump. However, volatility remains high, and the Central Bank itself has acted to try to stabilize the exchange rate.
Understand the Role of the Central Bank in This Scenario
The Central Bank is responsible for monitoring the currency flow and ensuring balance between the inflow and outflow of foreign currencies in the country. The institution also operates in the market through transactions with international reserves and foreign exchange auctions to contain abrupt fluctuations.
When investors withdraw capital from the country on a large scale, the real tends to depreciate, generating inflationary pressure and increasing the cost of imports. Hence the strategic importance of maintaining balanced external accounts.
