The deficit in the merchandise trade account narrowed to US dollars 393 million in May 2024 from US dollars 447 million recorded in May 2023, supported by a relatively larger contraction in import expenditure than that of export earnings. Similarly, the trade deficit in May 2024 narrowed compared to US dollars 558 million recorded in April 2024.
Meanwhile, the cumulative deficit in the trade account during January to May 2024 widened to US dollars 2,170 million from US dollars 1,926 million recorded over the same period in 2023.
Earnings from merchandise exports recorded a marginal decline of 0.8 per cent to US dollars 1,011 million in May 2024 compared to US dollars 1,019 million in May 2023.
A decline in earnings was observed in agricultural exports, while industrial exports and mineral exports increased in May 2024.
Expenditure on merchandise imports declined by 4.2 per cent to US dollars 1,405 million in May 2024 compared to US dollars 1,466 million in May 2023. Sea transport and Computer & IT/BPO related services were the major contributors to the increase in inflows to the rest of the services sector in May 2024.
The major outflows from the services sector in May 2024 were recorded mainly in relation to overseas travel, air transport, sea transport, manufacturing services, and Computer & IT/BPO related services. Total services sector outflows were estimated at US dollars 230 million in May 2024, in comparison to US dollars 196 million in May 2023
Gross Official Reserves stood at US dollars 5.4 billion at end May 2024, recording an increase of around US dollars 1 billion from end 2023.
This included the swap facility from the People’s Bank of China (PBOC) equivalent to around US dollars 1.5 billion, which is subject to conditionalities on usability.
The increase in the GOR since end 2023 was mainly due to the substantial net purchases of foreign exchange from the domestic foreign exchange market by the Central Bank. Net purchases by the Central Bank in May 2024 amounted to US dollars 193 million (based on trade date).
Meanwhile, import coverage of GOR (including the PBOC swap) amounted to 3.8 months of imports as at end May 2024.
Meanwhile Gross Official Reserves stood at US dollars 5.4 billion at end May 2024, recording an increase of around US dollars 1 billion from end 2023.
The increase in the GOR since end 2023 was mainly due to the substantial net purchases of foreign exchange from the domestic foreign exchange market by the Central Bank.
The post Merchandise trade account deficit down to USD 393 Mn in May appeared first on DailyNews.