India's current account deficit expected to rise to 1.7% of GDP in FY26 due to persistent tariff pressures: Union Bank Report

A current account deficit (CAD) occurs when a country's total value of imports of goods, services, and capital is greater than the total value of its exports and other income. It indicates that more money is flowing out of the country than is flowing in. The report highlighted that the trade deficit is likely to witness seasonal pressures due to festive demand effects. Lower commodity prices, especially oil, may, however, help limit the overall impact.