Net Foreign Liabilities Each quarter that Australia funds its current account deficit with net borrowing from the rest of the world, we gradually add to the stock of net foreign liabilities (NFL) we owe to the rest of the world.
First, policy actions should not amplify pro-cyclical dynamics, if overheatings risks in the economy and the financial system are to be contained. Second, macro-financial resilience is enhanced if buffers can be built during good times that will enable Ireland to cope more easily with future downside shocks.