Key Points
Goldman Sachs has lowered its projection for Indias current account deficit in 2024 to 1.3% of GDP from 1.9% earlier as the US bank expects services exports to continue surprising on the upside while crude oil prices are expected to decline, improving external balances...
Indias external balances remain favorable with a combination of low current account deficit, strong public market capital flows, adequate FX reserves and low external debt..
Combined with this, our expectations for a weaker dollar suggest a goldilocks environment for external balances, Goldman Sachs economists Santanu Sengupta, Arjun Varma and Andrew Tilton wrote in a January 2 note...
The economists pointed out that even though net foreign direct investment (FDI) inflows had turned positive in October they were still tracking materially lower in 2023 versus 2022 because of a higher cost of capital globally..
Based on the current run rates we estimate net FDI inflows to end the year at around $19 billion, the economists wrote...
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