CAD widens to $19 bn in Q2

India’ s current account deficit( CAD) wide ned to 2.9 percent of gross domestic product in the second quarter of 2018-19, as against 1.1 percent in the year-ago period, mainly due to a large trade deficit, the Reserve Bank of India said on Friday.

The CAD, or the difference between the outflow and in flow of foreign exchange in the country’ s current account, was $19.1 billion during the quarter ended September 30,2018. It increased from $6.9 billion, or 1.1 percent of GDP, in the second quarter of 2017-18. The CAD stood at $15.9 billion (2.4 percent of GDP) in the April-June quarter.

“India’ s CAD at $19.1 billion (2.9 percent of GDP) in Q2 of 201819 increased from $6.9 billion (1.1 percent of GDP) in Q2 of 2017-18 and $15.9 billion (2.4 percent of GDP) in the preceding quarter ,” the RBI said. The CAD has increased to 2.7 percent of GDP in the first half of 2018-19 from 1.8 percent in the corresponding period of 2017-18. According to the RBI, the widening of the CA Do na year-on-year basis was on account of a higher trade deficit at $50 billion as compared to $32.5 billion a year ago.