Brazilian current account surplus falls, Panama’s GDP, Turkish tax, Malaysian inflation

23/06/2006 | Duncan Hooper

Brazil’s current account surplus narrowed in May and the central bank said it reduced the 2006 forecast as foreign businesses repatriated profits. The surplus of $475 million, or 1.5% of GDP, compares with a $597 million surplus last year. The central bank’s head of researcg Altamir Lopes said the bank cut its prediction for the 2006 figure to $8.1 billion from $8.5 billion because it expects companies based abroad to take advantage of a stronger real to pull out profits. Foreign direct investment beat market expectations to grow by $1.6 billion last month.

Panama expects real GDP growth of 7.5%-8% this year after a stronger-than-expected outturn in the first quarter.

Nigerian finance minister Ngozi Okonjo-Iweala will take over as foreign minister, while retaining some of her previous responsibilities. Minister of State for Finance Nenadi Usman will fill the vacancy.

The Slovakian central bank dipped into its €13 billion of foreign exchanged reserves to intervene on behalf of its local currency to slow depreciation as foreign investors depart.

Turkish finance minister Kemal Unakitan pledged to end a 15% capital gains tax on foreign investor’s purchases of government bonds to try to spur appetite for government debt amid a crisis in confidence.

Higher revenue collection and stronger economic growth means that the Indonesian budget deficit will narrow by an additional 0.1 percentage points to 1.4% of GDP, according to Finance Minister Sri Mulyani Indrawati.

Malaysian inflation eased to an annual 3.9% in May from 4.6% the previous month.

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