UPDATE 2-Brazil posts 1st current acct deficit since 2002

Mon Jan 26, 2009 8:53am EST
(Recasts, adds details, forecasts throughout)
BRASILIA, Jan 26 (Reuters) - Brazil's current account fell into deficit in 2008 for the first time in six years as the global financial crisis prompted foreigners to repatriate money abroad and investors to pull cash out of emerging markets.
The $2.92 billion deficit in December was higher than expected and much bigger than a $498 million deficit in the same month of 2007, central bank data showed on Monday.
The country was expected to post a deficit of $2.85 billion for the month, according to the median forecast of 10 analysts surveyed by Reuters. Estimates for the deficit ranged from $3.8 billion to $2 billion.
A near 40 percent jump in income repatriation in 2008 and a rise in portfolio investment outflows pushed the country's current account into deficit last year, the central bank said.
For the whole of 2008, Brazil ran a current account deficit of $28.3 billion, compared with a surplus of $1.55 billion in 2007. The last time Brazil posted an annual current account deficit was 2002.
The current account balance tracks a country's net flow of external transactions, including foreign trade, interest payments and services such as tourism. It is used to gauge a country's dependence on foreign capital.
Brazil is on track to post a current deficit of $3.2 billion in January, according to Altamir Lopes, the head of the central bank's economic research department.
CAPITAL OUTFLOWS
Income repatriation rose 17.7 percent in December from a year ago to $4 billion. For the year, corporate remittances totaled $40.6 billion, a 38.5 percent increase over 2007.
Foreign portfolio investment outflow amounted to $5.4 billion in December. On the year, outflows totaled to $765 million compared to inflows of $48.1 billion last year.
In the 12 months through December, the the current account deficit was equal to 1.78 percent of gross domestic product compared with a deficit of 1.65 percent of GDP in the 12 months through November.
Foreign direct investment in Brazil, Latin America's largest economy, rose in December to $8.12 billion from $886 million in the same month in 2007. The December figure was the highest since June 2007.
For the whole of 2008, foreign direct investment totaled an all-time high of $45.06 billion, up from $34.58 billion in 2007.
In January, the country is expected to attract $2.5 billion in foreign direct investment, the central bank said. (For details on Brazil's current account figures, see: www.bcb.gov.br/?ECOIMPEXT) (Reporting by Isabel Versiani, Writing by Ana Nicolaci da Costa)