Brazil’s Economic Update (2024)

Brazil recorded a total net outflow of $18.01 billion in 2024, marking the largest figure since 2020, according to central bank data released on Wednesday. This trend occurred during a significant depreciation of the Brazilian real in the last weeks of the year.

Key Drivers of Outflow

• The outflow was primarily driven by the financial segment, which includes foreign investments, profit remittances, and interest payments.
• Conversely, there was a net inflow in the commercial segment related to exports and imports.

Currency Depreciation

The Brazilian real depreciated by over 27% last year, the largest fluctuation since 2020. The currency reached record lows in the final two months of 2024 due to market apprehensions regarding government spending and currency outflows.

December Performance

In December 2024, Brazil’s economy reported a staggering net outflow of $26.41 billion, according to the central bank.

Outlook for 2025

In 2025, the real has begun to recover, strengthening approximately 1% against the U.S. dollar in the spot market.