(Adds further data)
MADRID, May 29 (Reuters) - Spain's current account deficit fell to 6.55 billion euros ($9.17 billion) in March from 11.31 billion euros a year earlier as imports tumbled during the country's deep recession, Bank of Spain data showed on Friday.
The main reason for the fall was a sharp contraction in the trade deficit, as a 31.5 percent slump in imports outpaced a 13.6 percent fall in exports, the Bank of Spain said.
The figure compared with a 10.156 billion euro current account deficit in February.
Spain's imports have been sinking due to a steep contraction in domestic demand following the disappearance of abundant private sector credit.
Cheap credit allowed Spain's current account deficit to grow to the world's second-highest in nominal terms, beaten only by that of the United States, during a decade-long private-sector debt binge and property boom.
Now the country, whose euro membership rules out the option of devaluation, is being forced to make a steep adjustment to its previous consumption habits, as reflected by retail sales which fell by 7.5 percent year-on-year in April.
During the first three months of 2009, Spain's current account deficit came in at 23.29 billion euros, down from 32.31 billion from Jan-March 2008.
Following are details of the current account (in millions of euros):
MARCH 2008 MARCH 2009 CURRENT ACCOUNT -11,314 -6,550 Trade balance -8,974 -3,227 Services 1,307 1,389
Tourism and travel 1,944 1,571
Other -637 -182 Net factor income -2,241 -3,803 Transfers -1,407 -908 (Reporting by Jason Webb; Editing by Toby Chopra)