CAD rises to 2.1% in Q2 as gold imports soar

The current account deficit widened to USD 10.1 billion or 2.1 per cent of GDP for the September quarter as against 1.2 per cent in the year-ago period due to higher trade deficit, the Reserve Bank said today.
The current account deficit (CAD) is the net difference between inflows and outflows of foreign currencies.
"The increase in CAD was primarily on account of higher trade deficit contributed by both a deceleration in export growth and increase in imports," the RBI said.
Merchandise exports growth dipped 4.9 per cent in the second quarter, while there was an 8.1 per cent surge in imports on higher inbound gold shipments.

For the first six months of 2014-15, the current account gap narrowed to 1.9 per cent or USD 17.9 billion from 3.1 per cent in the same period a year-ago, the RBI data showed.
There was a net accretion of USD 6.9 billion to the forex reserves during the reporting quarter as against a drawdown of USD 10.4 billion.

Net inflows of NRI deposits at USD 4.1 billion in Q2 were lower than the USD 8.2 billion notched up during the days of rupee fall in the year ago period, the RBI said.
External commercial borrowings by enterprises at USD 1.4 billion in were higher than USD 1.3 billion year-on-year.

CAD 1.2 per cent in the second quarter of the previous fiscal on unconventional moves to arrest the rupee slide. It stood at 1.7 per cent for the preceding June quarter this year.
On services, the net services improved by 3.4 per cent on a pick-up in telecommunications, computer and information services, the RBI said.