External Balance

What is External Balance?


1.

the current account balance; the net flow of liquid assetsto the citizens of a particular country. The external balance includes the trade balance, net foreign factor income, and net foreign aid *received*. Usually the main cause of an external deficit is a trade deficit.

External balances are critical to good economic policies.

See capital account balance, balance of payments, trade balance, nipa

2.

the current account balance; the net flow of liquid assetsto the citizens of a particular country. The external balance includes the trade balance, net foreign factor income, and net foreign aid *received*. Usually the main cause of an external deficit is a trade deficit.

External balances are critical to good economic policies.

See trade balance, capital account balance, balance of payments, nipa


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