Current Account Deficit

India's current account deficit narrowed to $5.2 billion in August from $6.1 billion a year ago, while strong banking capital inflows helped the BoP post a $45.4 billion surplus

India's current account deficit narrowed to USD 5.2 billion in August from USD 6.1 billion a year ago, aided by a lower merchandise trade deficit and higher surpluses in services trade, according to preliminary data released by the RBI on Thursday. The net deficit in the merchandise trade account declined to USD 26.6 billion in August from USD 27.6 billion in the same month last year. Merchandise exports rose to USD 44.7 billion in August from USD 35.1 billion a year ago, while imports increased to USD 71.3 billion from USD 62.7 billion, the RBI data showed. The surplus in services trade increased to USD 16.5 billion in August from USD 15.6 billion a year ago. Services exports rose to USD 35.5 billion from USD 31.2 billion, while imports increased to USD 18.9 billion from USD 15.6 billion. Net transfers, including remittances, increased to USD 12.8 billion in August from USD 12.2 billion a year ago, while the net deficit in the income account widened to USD 8 billion from USD 6.3 .

Within the BoP, the current account yielded a deficit (CAD) in the first quarter of financial year 2026-27 (Q1FY27), reversing the surplus seen in Q4FY26, as the merchandise trade deficit widened

Net foreign portfolio inflows fell 16.6 per cent in FY26, while net FDI stood at $7.8 billion against gross inflows of $94.5 billion amid repatriation and outward investment.

RBI Deputy Governor Poonam Gupta sees a case for rupee appreciation as the current account deficit shrinks and capital flows improve, potentially later this financial year.

The merchandise trade deficit widened to $31.7 billion in July, while strong capital inflows helped push the balance of payments surplus to $20.8 billion.

Balance of payments recorded a deficit of $8.1 billion in Q1FY27 as portfolio outflows weighed, compared with a surplus of $4.5 billion in the year-ago quarter

Merchandise trade deficit at USD 86.1 billion in the April-June period of 2026-27 was higher than USD 68.9 billion in the first quarter of 2025-26.

Economists have sharply lowered India's FY27 current account deficit forecast as softer crude oil prices, resilient exports and remittances improve the external outlook

A widening trade deficit and foreign fund outflows strained India's external accounts in FY26 despite robust growth in services exports and remittance inflows

India's macro picture stayed broadly resilient this week, but higher fuel and food prices, global uncertainty, and policy adjustments kept pressure on households and companies

Strong services exports and record remittance inflows helped India record a current account surplus of $7.1 billion in the March quarter despite continued capital outflows

From fuel hikes to a record RBI dividend, the week ending May 24 showed how global oil, imports, heatwaves and policy buffers are shaping India's macro outlook

Goyal said the government has no plans to cut non-essential imports into India as of now

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India's current account deficit is set to widen to 2.3 per cent of GDP in FY27 from 0.9 per cent in FY26, a foreign brokerage said on Monday. The balance of payments (BoP) deficit is estimated to widen to USD 65 billion in the current fiscal from the last fiscal year's USD 35 billion, it said. HSBC said it has assumed crude prices to average USD 95 a barrel, and combined it with sensitivities in oil, gold, core goods, services trade and remittances to arrive at a current account deficit of 2.3 per cent of GDP in FY27 as against 0.9 per cent in FY26. The BoP forecast has been made after growing through trends in portfolio inflows, FDI flows, and external commercial borrowing (ECBs), it said. The report also looked at forex reserves and opined that the nearly USD 700 billion kitty seems sufficient from the traditional perspective, but suggested the need to look at it from a dynamic perspective, better for the current times of heightened risks amid recurring global shocks. "Using a .

Economists broadly agree that this financial year is shaping up to be tougher than the last for the external account

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There are moments (like the present) when current account deficits are widening in response to shocks, but our system has a well-developed playbook for dealing with these

India's current account deficit widened to $13.2 billion in Q3FY26 as the trade gap expanded, though higher services receipts, lower investment outflows and stronger remittances provided some support