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'Leads and lags'


The differences in timing in the settlement of debts in international trade. These differences could cause a deficit or surplus for a short period in the balance of payments, even though the underlying trade was in balance. The effect may be particularly acute when there is an expectation of a change in the exchange rate. Importing countries will delay payment to their supplying country if it is expected that the latter's rate of exchange will fall.

Reference: The Penguin Dictionary of Economics, 3rd edt.