Fiscal balance
The difference between government revenue and expenditure over a period.
Plain languagePractical exampleConnected reading
01
What is it?
The difference between government revenue and expenditure over a period.
02
Why does it matter?
It can affect borrowing needs, domestic demand, bond supply and monetary transmission.
03
How should it be read?
Review the primary balance, one-off revenue, inflation effects and financing mix separately.
04
Common mistake
Comparing nominal deficits without scaling them to the economy.
A simple example
The same nominal deficit can be a larger burden in a smaller economy.