This is when government spending is greater than taxation revenues. It is measured by PSNCR. Public sector net cash requirement. A fiscal deficit is also know as government borrowing.
Current Account deficit.
The Current account of the balance of payments, measures trade in goods, services and investment incomes. Therefore, a deficit implies the value of imports is greater than exports.
- Note this current account deficit is not due to the government.
- A deficit on the current account means that there will need to be a surplus on the financial / capital account component of the balance of payments.
- Balance of Payments