What is a balance-of-payments deficit?

What will be an ideal response?

A nation is said to have a balance-of-payments deficit when imbalances in the combined current account and capital and financial account lead to a decrease in official reserves. In this case, there is a net sale of official reserves by a nation’s treasury or central bank to bring the balance of payments into balance. The net sale of official reserves shows up as an addition (+) to the foreign purchases of U.S. assets item because they are a credit or inflow of a nation’s currency. The decrease in official reserves ensures that the balance of payments sum to zero.