Current Account and Expansionary Fiscal and Monetary Policy

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LordJeffrey

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What is the effect of Expansionary Fiscal Policy on the Current Account and of Expansionary Monetary Policy on the Current Account? Thanks, I can’t tell if I wrote this down wrong on my note card and I do not have that book with me.
 
expansionary monetary -> current account surplus
expansionary fiscal -> current account deficit
 
I was just looking at this. I haven’t gotten to economics yet. Can you explain this maratikus?
 
Here is my approach to remember the relationship:
expansionary monetary -> currency depreciation -> domestic products are more competitive -> exports increase -> current account surplus
expansionary fiscal -> currency appreciation -> … -> current account deficit
 
Thanks Maratikus… Do you have an intuative way to think about why Fiscal Expansion would cause currency appreciation?
 
Fiscal expansion -> increased Aggregate Demand -> increases real rate -> currency appreciation.
 
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