The country’s current account deficit (CAD) narrowed sharply to USD 1.4 billion, or 0.2 per cent of GDP, for the December 2019 quarter, the Reserve Bank of India (RBI) said on Thursday. The deficit had stood at 2.7 per cent in the corresponding quarter a year ago and 0.9 per cent in the previous quarter. The sharp contraction in the deficit was mainly due to a lower trade deficit of USD 34.6 billion, and a rise in net services receipts, the central bank said. The CAD, a critical indicator of the macroeconomic health, represents the gap between the overall foreign exchange expended and received in the economy. The release of the data, coming at a time when markets are spooked due to the coronavirus concerns, will help provide hope to investors.
