Brazil's external finances finished 2025 with a current account deficit that was effectively unchanged from the prior year, according to central bank data released on Monday. The shortfall came in at 3.02% of gross domestic product (GDP), compared with 3.03% in 2024.
Earlier in 2025 the deficit had widened to almost 3.7% of GDP on a 12-month rolling basis. That deterioration was mainly linked to a smaller trade surplus as imports outpaced exports amid relatively resilient domestic demand.
In the latter part of the year, however, signs of an economic slowdown became more apparent. The central bank retained an aggressive monetary stance, keeping its policy interest rate at 15%, a level described by officials as a nearly 20-year high, as it sought to steer inflation back toward its 3% target. Policymakers are scheduled to meet again on Tuesday and Wednesday, and market participants broadly expect the bank to hold rates steady for a fifth consecutive meeting.
Foreign direct investment proved sufficient to largely cover the current account deficit over the full year. FDI totaled 3.41% of GDP in 2025, marginally above the 3.39% of GDP recorded in 2024.
Monthly flows in December painted a mixed picture. The current account registered a deficit of $3.4 billion for the month, narrower than the $5.3 billion shortfall economists polled by Reuters had expected. The smaller-than-anticipated deficit reflected a notably strong trade surplus of $8.8 billion in December, more than double the level recorded in the same month a year earlier.
At the same time, foreign direct investment showed a net outflow of $5.2 billion in December, in contrast to the $1 billion inflow expected in the Reuters poll. The central bank attributed this December FDI reversal primarily to net outflows of $11.4 billion in reinvested earnings, a sign that profit remittances exceeded the profits accrued during the month.
Policy changes at the start of the year may be relevant to these flows. Beginning in January, the government implemented a 10% withholding tax on profit remittances sent abroad, a measure that affects the returns investors send back to parent companies outside Brazil.
Overall, the central bank data depict a year in which Brazil's external deficit returned to a level close to that of 2024, with FDI continuing to play the primary role in covering the gap despite episodic monthly volatility.