Final answer:
The trade balance and current account balance align closely because the trade balance is integral to the current account, affecting it directly as exports and imports alter a country's financial flows.
Step-by-step explanation:
The reason trade balance and current account balance track closely together over time is that the trade balance is a major component of the current account. The connection between trade balances and international financial flows is so significant that economists often equate the balance of trade with the balance of payments.
The trade balance includes exports and imports of goods and services, while the current account encompasses the trade balance plus other factors like net income from abroad and net current transfers. When a country exports goods, it receives payment from other countries, which counts as a credit in the current account. Conversely, importing goods results in payments to other countries, registering as a debit on the current account. Consequently, changes in the trade balance directly affect the current account balance, causing them to align closely over time.