India’s September merchandise trade deficit below forecast on lower gold imports

By Shivangi Acharya

NEW DELHI (Reuters) -India’s merchandise trade deficit was narrower than expected in September, helped by a sharp sequential drop in gold imports, according to government data released on Wednesday.

The merchandise trade deficit was $20.78 billion last month, lower than economists’ expectation of $25 billion, according to a Reuters poll.

The deficit had widened to a ten-month high of $29.65 billion in August.

Merchandise exports dropped to $34.58 billion in September from $34.71 billion in August. The fall in imports was much sharper, to $55.36 billion from $64.36 billion.

Gold imports were $4.39 billion in September, sharply lower than $10.06 billion in August.

“Last month’s gold imports were a one-off, driven by high purchases to build inventory ahead of festivals and favourable prices,” said a trade ministry official, who did not want to be named.

Services exports were an estimated $30.61 billion last month, while imports were $16.32 billion.

In August, services exports were $30.69 billion and imports were $15.70 billion.

(Reporting by Shivangi Acharya; Editing by Mrigank Dhaniwala and Janane Venkatraman)