India’s Current Account Reverts To A Deficit In Q2; Sharp Widening Expected In Q3: ICRA
BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
ICRA Research Report
India’s current account reverted to a deficit of $9.6 billion (down 1.3% of gross domestic product) in Q2 FY22 from the surplus of $6.6 billion (up 0.9% of GDP) in Q1 FY22, primarily led by a widening of the merchandise trade deficit (to $44.4 billion in Q2 FY22 from $30.7 billion in Q1 FY22).
While the Q2 FY22 print was somewhat smaller than our expectation, a considerable widening lies ahead, with the large merchandise trade deficits seen in October-November 2021, and the same being anticipated for December 2021.
We expect the current account deficit to print in excess of $25 billion in Q3 FY22, rivalling the size of the full year current account deficit in FY20. Consequently, we expect India’s current account balance to revert to a deficit of around $40-45 billion or 1.4% of GDP in FY22, from the surplus of $24.0 billion (up 0.9% of GDP) in FY2021.
Click on the attachment to read the full report:
This report is authored by an external party. BloombergQuint does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BloombergQuint.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.