Balance of payment deficit

Definition

A balance of payment deficit occurs when a country imports more goods, services, and capital than it exports. This leads to an outflow of currency from the country and can result in negative economic consequences.

Related terms

Trade surplus: When a country exports more goods and services than it imports.

Current account: Part of the balance of payments that tracks trade in goods and services.

Capital account: Part of the balance of payments that records transactions involving financial assets.