India's current account deficit narrows to $5.2 billion in August as capital account surplus hits $50.6 billion
Economic Times 1 hr ago·15 Oct 2026, 3:56 pm
India's balance of payments improved significantly in August, with the current account deficit shrinking to $5.2 billion. This was driven by a strong capital account surplus of $50.6 billion, largely due to a surge in non-resident deposits. Consequently, the overall balance of payments moved into a surplus of $45.4 billion, reversing the previous year's deficit.
For investors, this data signals a robust resilience in India's external sector. A healthy capital account surplus suggests sustained foreign interest and liquidity, which can support the rupee and provide stability for domestic markets. However, the substantial net outflow in external commercial borrowing warrants a watchful eye as it highlights a specific area of vulnerability within the broader economic health.
Moving forward, market participants should monitor the sustainability of these capital inflows and the trajectory of external commercial borrowing. While the current account deficit is narrowing, the focus will remain on whether the capital account surplus can maintain this momentum to offset any future outflows.
Excerpt from Economic Times
India's current account deficit narrowed to $5.2 billion in August, compared to $6.1 billion a year earlier. The capital account surplus increased substantially to $50.6 billion, influenced by non-resident deposits of $83 billion. The balance of payments showed a surplus of $45.4 billion, contrasting with a deficit of…Read the original at Economic Times
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