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MUMBAI: India’s current account deficit has declined to $18.2 billion, which is 2.2% of the GDP in the third quarter of 2022-23, from $30.9 billion (3.7% of GDP) in the previous quarter and $22.2 billion (2.7% of GDP) in the year-ago period.
According to data released by the RBI, the narrowing of the current account deficit was due to a reduction in the merchandise trade deficit to $72.7 billion from $78.3 billion in the previous quarter, along with an increase in services and private transfer receipts.
“The continued moderation in the current account deficit in Q4 2022 was another positive surprise and a sign of this trend getting entrenched amid lower commodity prices and a steady services trade surplus. We expect even smaller deficits in FY24 to boost macro stability,” said Rahul Bajoria, an economist with Barclays.
The current account deficit is the difference between the value of a country’s total imports of goods, services, and investments and the value of its total exports.
According to data released by the RBI, the narrowing of the current account deficit was due to a reduction in the merchandise trade deficit to $72.7 billion from $78.3 billion in the previous quarter, along with an increase in services and private transfer receipts.
“The continued moderation in the current account deficit in Q4 2022 was another positive surprise and a sign of this trend getting entrenched amid lower commodity prices and a steady services trade surplus. We expect even smaller deficits in FY24 to boost macro stability,” said Rahul Bajoria, an economist with Barclays.
The current account deficit is the difference between the value of a country’s total imports of goods, services, and investments and the value of its total exports.
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