ICRA projects current account deficit of US$ 6-8 billion for Q1FY2015

Sharp decline in gold imports and higher exports helping to cut trade deficit to US$ 35.4 billion in Q1FY15

ICRA expects a sharp decline in gold imports and higher exports to have reduced the merchandise trade deficit from US$ 50.5 billion in Q1FY14 to US$ 35.4 billion in Q1FY15 (on a BoP basis), somewhat higher than the level in the previous three quarters.

However, ICRA expects the services trade surplus to ease slightly to US$ 17.2 billion in Q1FY15 from US$ 17.4 billion in Q1FY14. Overall, the current account deficit is likely to print at a limited US$ 6-8 billion in Q1FY15 as compared to US$ 21.7 billion in Q1FY14 and US$ 1-5 billion in the previous three quarters.

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