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Economics vocabulary · Trade and Exchange Rates

Trade deficit

Meaning in economics, with examples

nounCore term

In economics, trade deficit means: The gap that appears when the value of a country's imports of goods, and sometimes services, is greater than the value of its exports over a period.

In Turkish: dış ticaret açığı, ticaret açığı

How it is used

Reported monthly: the trade deficit widened or narrowed. The opposite is a trade surplus. Note that the trade balance is only one part of the current account, which also includes income flows and transfers.

Example sentences

  1. The trade deficit widened in August as energy imports rose.

  2. A weaker currency can help to narrow a trade deficit by making exports cheaper.

Common collocations

  • a widening trade deficit
  • narrow the trade deficit
  • trade balance
  • trade surplus
  • trade deficit with
  • current account deficitA shortfall that arises when a country pays more to the rest of the world for goods, services, income and transfers than it receives.
  • exportA good or service sold to buyers in another country; as a verb, to sell goods or services abroad.
  • importA good or service bought from producers in another country; as a verb, to bring goods or services in from abroad.
  • balance of paymentsA record of all money flows between a country and the rest of the world over a period, divided into the current account and the capital and financial account.
  • surplusAn amount left over: in a market, more supply than demand at the current price; in public finance or trade, more income than spending.

This word in other fields

The same English word can have a different meaning in another field:

More terms: Trade and Exchange Rates

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This page explains English vocabulary for learners. It is not financial advice.