The balance of payments (BOP) is a statement of all transactions made between entities in one country and the rest of the world over a defined period of time, such as a quarter or a year. This account records all the economic/monetary transactions between the residents (all the units) of a country and the rest of the world in an accounting year and also records the undertakings or transactions of commodities, assets, and services between the citizens of a nation with the rest of the world for a stated time frame frequently every year. The impact of these policies is ultimately captured in the balance of payments data. While a nation's balance of payments necessarily zeroes out the current and capital accounts, imbalances can and do appear between different countries' current accounts. It examines the transaction of all the exports and imports of goods and services for a given period.

Sahreen Younis Ahanger

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