Balance of Payments Accounts

Definition

Balance of Payments Accounts is a record of all economic transactions between residents of one country and residents of foreign countries during a specific period. It consists of three main components - current account, capital account, and financial account.

Related terms

Current Account Deficit/Surplus: A deficit occurs when a country's imports exceed its exports in value; surplus occurs when exports exceed imports.

Capital Account Transactions: Records financial flows related to non-produced/non-financial assets like land purchases or debt forgiveness.

Financial Account Transactions: Tracks changes in ownership interest involving financial assets such as stocks, bonds, or direct investment abroad.