C/A Deficit Narrows In Q3, But Overall Widening Trend Persists

BMI View: India's massive trade and current account deficits will constrain the rupee's performance in the medium term. The trade gap widened 46.5% to US$50.59bn in the third quarter of the last fiscal year (April-March) and, although the current account deficit narrowed during the same period, BMI forecasts further widening of the deficits in FY07/08. This will ultimately weigh on the rupee.

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