Brasília, 6/21/2004 (Agência Brasil) - The Central Bank's weekly market survey (Focus) has found that for the sixth consecutive week market specialist and financial institution expectations are for higher inflation. Last week Focus found that expectations for year-end inflation were for it to reach 6.61%; this week 's survey found that expectations have risen to 6.79%. Meanwhile, the official government inflation target for the year remains at 5.5%.

The survey also found that the market has raised its expectations for next year's (2005) inflation to 5.5%, compared to the official target of 4.5%.

With regard to market estimates for direct foreign investments, there was a slight drop from US$11 billion to US$10.62 billion. The market expects interest rates to fall to 15% (they are currently at 16% per year), and the dollar to close out the year at R$3.10.

Market estimates for the foreign trade surplus were steady for the week at US$27 billion, but there was a rise in expectations for the current account surplus, from US$3.10 billion to US$3.55 billion.

(Translator: Allen Bennett)