4.6 Balance of payments

• Balance of payments records credit and debit items

• Accounts can show surpluses or deficits

• Calculation: elements of the balance of payments from data

• Current account includes trade in goods, trade in services, income, and current transfers

• Capital account includes capital transfers and transactions in non-produced non-financial assets

• Financial account includes FDI, portfolio investment, reserve assets, and official borrowing

• The balance of payments has an overall zero balance

• Credits are matched by debits

• Deficits are matched by surpluses