Deficit
a.k.a. Budget deficit
When spending is larger than income.
In plain English
When spending is larger than income. For governments, the gap between what they spend and what they collect in taxes in a year.
A deficit is a shortfall. A budget deficit means the government spent more than it took in and must borrow the rest, adding to its debt. A trade deficit means a country imported more than it exported.
Big, persistent deficits can push up bond yields and make investors question a currency, especially if they fear money will be printed to cover them.
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