India’s current account deficit (CAD) was $14.3 billion or 2 percent of GDP in Q1 FY19-20 compared to US$ 15.8 billion (2.3 percent of GDP) in Q1 FY18-19. The contraction of CAD was primarily on account of high invisible receipts of US$ 31.9 billion in Q1 FY19-20 as compared to US$ 29.9 billion in FY18-19. Key performance of BOP components (BPM6): Current Account:Private transfer receipts, an indicator of remittances by Indians employed overseas, rose US$19.9 billion (6.2 percent Y-o-Y) in Q1 FY19-20 from US$ 18.6 billion in Q1 FY18-19.Net services receipts rose US$ 20.03 billion in Q1 FY 19-20 (7.3 percent on Y-o-Y) from US$ 18.68 billion in Q1 FY18-19 due to the rise in net earnings from travel, information technology and financial services. Financial Account:Portfolio investment which recorded net inflow of US$ 4.8 billion in Q1 FY19-20 compared to outflow of US$ 8.1 billion in Q4 FY18-19.Net foreign direct investment rose 45 percent on Y-o-Y to US$ 13.9 billion in Q1 FY19-20 from US$ 9.6 billion Q1 FY18-19.Net inflow on external commercial borrowings stood at US$ 6.3 billion in Q1 FY19-20 compared to outflow of US$ 1.5 billion in Q4 FY18-19.Foreign exchange reserves (on BOP basis) rose US$ 13.98 billion in Q1 FY19-20 compared to depletion of US$ 11.33 billion in Q1 FY18-19. The contraction in CAD has both external and domestic factors. On external front, lower crude oil prices which averaged US$ 56 per barrel in 2019 compared to US$ 65 per barrel in 2018 was an important factor. On domestic front, India's economy slowed down in Q1 FY19-20 dragged down by major factors such as weaker private consumption, slower consumer demand and slow increase in fixed investment. As a result, imports grew slower than exports which helped to improve CAD. Moreover, government of India (GOI) has taken number of steps to boost capital inflows and curb nonessential imports. Some of the major steps are as follow:Eased the regulatory and compliance framework for foreign portfolio investors (FPI).Allowed manufacturing units to access external commercial borrowings up to US$ 50 million for a minimum maturity of one year.Raised import tariffs on washing machines, refrigerators, tyres, aviation turbine fuel (ATF) and etc.
(7 October 2020) The depreciation of the Russian ruble by 26 percent against the US dollar since March 2020 directly relates to a reduction in the trade balance and capital outflows by the private sector in the wake of anti-COVID lockdowns and a drop in global energy demand and prices. Analysis of the monthly balance of payment statistics from the Central Bank of Russia suggests the outlines of a new equilibrium for the ruble:Russia's current account balance since April has shrunk to zero.At the same time, the Russian Central Bank has cut the policy rate from 6.25 percent to a record low 4.25 percent, which has in turn lowered returns on foreign short-term investment into Russian debt securities and contributed to the outflow of capital to the tune of $4-5 billion per month.Without further intervention from the Russian Central Bank, we estimate that foreign currency flows will rebalance if imports decrease by $4 billion per month, which equates an exchange rate of about 85 rubles per $1 (assuming each 1% depreciation of the ruble corresponds to a 1% decrease in imports). As a policy matter and economic imperative, the Russian Central Bank has sufficient foreign exchange reserves to prevent the weakening of the ruble to 85 rubles per $1. Despite 30 percent YoY decrease of exports during the March-July 2020 period, Russian foreign exchange reserves grew to a record $595 billion by the end of August 2020, mainly due to the increase in gold prices.
Nigeria’s external reserves dropped to $40.7 billion at the end of Q3 2019, a single-quarter decrease of $4 billion. By the end of 2019, Nigeria’s external reserves dropped even deeper to less than $39 billion. As analysts began predicting that the falling reserves might force the Central Bank of Nigeria (CBN) to depreciate the naira, the CBN sought to calm markets and announce that the probability of a naira devaluation is low provided crude oil prices remain stable in 2020. Nigeria's current-account deficit narrowed in Q3 2019 to -2.3% from a revised -3.3% of GDP the previous quarter, reflecting stronger trade performance. Exports hovered in late 2019 in the $15 billion to $16 billion range, while the trade balance showed improvement in Q3 largely due to a $2 billion decrease in imports to $12.6 billion.The net deficit on services has settled between $8 billion and $8.5 billion over the past four quarters.The CBN has also made some sizable data revisions for Q2 2019: the trade deficit has narrowed from 2.2% to 1.3% of GDP and the current-account deficit has widened from -2.5% to -3.3%, as previously mentioned. The culprit was an increase in oil and gas imports from $2.2 billion to $3 billion.
Brazil’s current account deficit (CAD) widened to US$ 7873.97 million in October as compared to US$ 4139.03 in September 2019, exceeding market expectations. The CAD, percentage of gross domestic product (GDP) reached to 3 percent in October, highest since December 2015. Through the first 10 months of 2019, the deficit reached to US$ 45657.03 million as compared to US$ 32371.94 million deficit for the first 10 months of 2018. Thereby recording 41 percent rise in 2019 as compared to 2018. The CAD print is also impacted by recent revision in methodology for measuring historical balance of payments statistics. Goods exports contracted 16.5 percent YoY to US$ 18301.73 million in October compared to 1.2 percent contraction in September 2019, while imports grew 7.5 percent in October compared to 17.9 percent growth in September 2019.
China’s current account (CA) returned to a small surplus, $5.3bn in Q2 after the first quarterly deficit in Q1 2018 since 2001 as per data released by “State Administration of Foreign Exchange”. The CA surplus in Q2 was driven by the goods trade components. Year-on-year export growth was slower than import growth in Q2, but the value of exports was much bigger than that of imports and has helped to widen the trade surplus. The growing services trade deficit, which includes outbound tourism, education, entertainment as well as purchases of foreign technologies and patents, highlights the changing nature of China’s economy, even as it remains the world’s largest exporter.
Thailand's Current Account recorded a surplus of 1.1 US$ billion in July 2018, compared with a surplus of 4.1 US$ billion in the previous month. A surprise narrower current account surplus of 958 US$ million in May, 2018 compared to 1.4 US$ billion in April 2018. Thailand's Current Account Balance had reached an all-time high of 7.6 US$ billion in Feb 2016 and a record low of -3.7 US$ billion in Apr 2013. After a strong run in surplus for the last four years, Thailand’s external payments have started to weaken and expected to continue the weak trend as the global trade war threatens export, lack of confidence in emerging market and rising oil prices boosting imports. Weakening external payments are negative for the Thai Baht (THB). The currency is one of the Asia’s worst performer for last couple of months. A reversal of fortune from being Asia’s outperformer last year through early this year.
China has registered 2018Q1 current account deficit after approx 17 years since 2001Q2 at the time when US has imposed 25 per cent tariff on China's import to curb imports from China and to boost domestic economy. China was running a current account surplus on an annual basis in the past 25 years, last time current account deficit on annual basis was in 1993.
BOP and IIP Data by Indicator | BOP an IIP Data by Economy | BOP and IIP Data (Tables) Source: IMF Balance of Payments Statistics (BOPS)
Source: IMF Balance of Payments Statistics (BOPS)
The bilateral relationship between the Republic of India and the Republic of South Africa have grown strong since the end of apartheid in South Africa in 1994. Both countries have since developed close strategic, cultural and economic ties. The below visualization shows the top 10 export and import of trade relation between India and South Africa.
The mission will include meetings with the African Development Bank, World Bank Group, Government Implementing Agencies, and the local private sector. Event Holder: World Bank Group Source of data: World Development Indicators (WDI), June 2016, The World Bank
Source: IMF Balance of Payments Statistics (BOPS)
Balance of Payments (BOP) is a method employed by countries to monitor all international monetary transactions occured during a particular period of time. Usually, Balance of Payments is calculated quarterly and annually. All trades conducted by both the private and public sectors are accounted for in country's Balance of Payments in order to determine how much money is going in and out of the country's economy. If a country has received money, this is noted as a credit, and if a country has paid or given money, the transaction is counted as a debit. Theoretically, Balance of Payments should equal zero, meaning that assets (credits) and liabilities (debits) are in balance, but in practice this is rarely the case. Thus, a Balance of Payments can tell the observer if a country has a deficit or a surplus and from which part of the economy the discrepancies are stemming. Net International Investment Position (NIIP) is defined as the value of overseas assets owned by a country less the value of domestic assets owned by foreigners. The NIIP can therefore be regarded as a nation’s balance sheet with the rest of the world at a particular point in time. NIIP includes overseas assets and liabilities held by a the country’s government, the private sector and its citizens. A negative NIIP shows that a nation’s foreign liabilities exceed its foreign assets, whereas a positive NIIP figure indicates that its foreign assets exceed its liabilities. Source: IMF Balance of Payments and International Investment Position Statistics
BOP and IIP Data by Indicator | BOP an IIP Data by Economy | BOP and IIP Data (Tables) Source: IMF Balance of Payments Statistics (BOPS)
BOP and IIP Data by Indicator | BOP an IIP Data by Economy | BOP and IIP Data (Tables) Source: IMF Balance of Payments Statistics (BOPS)