The current account showed a deficit of USD 5.6 billion in 1Q23, up from a deficit of USD 1.5 billion in the same quarter of 2022, led by a goods deficit. The rolling four-quarter balance deteriorated to a deficit of 1.3% of GDP from 0.7% before. At the margin, we estimate that the seasonally adjusted current account posted a deficit of 3.1% of GDP in 1Q23.
Trade balance for goods turned into deficit in 1Q23, down from a surplus in 1Q22. Exports decreased by 17.9%, affected by a severe drought, while imports declined by 2.9 yoy due to tighter controls. Thus, the trade balance for goods moved to a USD 0.4 billion deficit in the period, from a surplus of USD 2.6 billion in the same quarter of 2022. The service account deficit stayed almost unchanged, at USD 2.2 billion, from USD 2.0 billion one year earlier. The deficit for the income balance (net interest bill and dividend payments) widened to USD 3.5 billion, from a deficit of USD 2.6 billion in 1Q22.
International reserves decreased by USD 6.0 billion during the first quarter of 2023, mostly reflecting the above-mentioned current account deficit and no access to international markets. External debt stood at USD 275.1 billion in 1Q23 (43.2% of GDP).
We forecast a current account deficit of 1.5% of GDP for 2023, but the risks are tilted to a wider deficit.