New Delhi, Sept. 17 -- India's goods trade deficit narrowed by USD 5.1 billion month-on-month to USD 26.9 billion in August, but the gap could stabilise around current levels as both exports and imports remain strong, with oil prices emerging as a key factor, Nuvama Research said in a report.

"While the trade deficit has narrowed, it could stabilise around current levels with oil prices remaining the key monitorable," the report said.

The brokerage further said export and import momentum is likely to remain firm in the near term, partly driven by higher prices. It added that, "strong FCNR inflows provide a cushion, limiting near-term pressure on the INR."

The narrowing in the trade deficit was led by a USD 1.5 billion improvement in th...