MUMBAI, Aug 3 Reuters India39;s record high trade deficit in July signals a further deterioration in the country39;s external balances, which is likely to keep the rupee under pressure, analysts said on Wednesday.

Trade deficit in Asia39;s third largest economy widened to an alltime high of 31 billion, data on Tuesday showed, prompting concerns about the country39;s ability to fund its current account deficit and hurting the outlook for the rupee.

I think after looking at the July trade deficit, we need to rework on our CAD and BoP number, and thus the view on the rupee, Vikas Bajaj, head of currency derivatives at Kotak Securities, said.

Bajaj pointed out that until now the market consensus for India39;s current account deficit CAD was around 100 billion for the current fiscal year ending in March.

But this definitely looks out of whack after July39;s trade number, he said.

In a note on Wednesday, QuantEco Research revised their CAD projections higher for the current fiscal year to 130 billion from 105 billion and the balance of payments BoP estimate to 60 billion from 35 billion.

The partially convertible rupee was trading at 79.02 per U.S. dollar in afternoon trade, 0.4 weaker on the day. On Tuesday, the unit had touched 78.49, its highest level since June 28. The local currency hit a record low of 80.0650 on July 19.

Vivek Kumar, a economist at QuantEco, said the recent recovery in the rupee from 80 will prove to be temporary and expects the local unit to…