Current account deficit jumps to $572mn in April 2020
KARACHI: Pakistan’s Current Account Deficit (CAD) increased sharply to $572 million (2.7% of GDP) in April-2020 from $9 million in March 2020.
In the midst of lockdown, exports were the leading contributor to CAD deterioration, dropping 24% MoM. As a result, the trade deficit inflated by 18% MoM.
Although remittances declined 5% MoM, it was a relatively softer decline, partly due to Ramadan and also due to higher inflows from the US.
Outflows from portfolio investment in local currency debt securities reduced to $566 million in Apr-2020, compared to $1.83 billion in March 2020.
Despite the worsening of CAD, overall balance of payments improved, owing to $1.4 billion inflow from the IMF's rapid financial assistance.
Current account deficit in 10 months (July-April 2019-20) clocked in at $3.34 billion.