New Delhi, Dec. 11 -- India's external sector is showing mixed signals as merchandise exports lose momentum amid tariff-related disruptions; however, services exports continue to provide critical support to the country's current account position, noted a report by CareEdge.

"Looking ahead, as merchandise exports navigate a challenging environment, we expect the services trade surplus and transfers to maintain their support. This, coupled with benign global crude oil prices, is likely to keep India's current account deficit broadly manageable at around 1% of GDP in FY26." noted the report.

CareEdge highlighted that the export environment, which benefitted from front-loading in the initial months of FY26, has begun to soften since Septemb...