Higher dairy exports helped shrink the gap between what New Zealand earned and spent overseas in the final three months of last year.
The amount of debt owed to foreigners also fell slightly.
The deficit at the end of last year was $8.3 billion, down from $8.8 billion for the year to the end of September.
The surplus from the trade in goods was $3.5 billion, up from $3 billion at the end of September.
ANZ New Zealand senior economist Mark Smith says strong production in the agricultural sector helped boost the goods sector, with dairy exports coming to the fore.
He says demand for imports also lessened slightly.
Mr Smith says falling global commodity prices, a high New Zealand dollar and tepid trading partner growth will prompt the deficit to widen again.
He says it's likely terms of trade will decline and import demand pick up, which will contribute to a worsening current account deficit.
But Mr Smith says deleveraging is ongoing and that's likely to cap credit growth which should result in the current account deficit remaining fairly contained.
The income deficit, which measures the net flow of dividends and interest payments between New Zealand and the rest of the world, was unchanged at $10.4 billion.
New Zealand's net debt fell slightly to $145 billion.
The difference between debt to foreigners and New Zealand's assets overseas rose by $2.2 billion.
That was due to a large fall in foreign ownership of New Zealand government bonds and payouts from overseas insurers after the Christchurch quakes.