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CA deficit: consuming more than  producing.If there is a current account deficit, it means There is a surplus on the financial / capital account. 

A CA deficit is considered harmful because: - If a current account deficit is financed through Borrowing it is said to be more unsustainable. This is because borrowing is Unsustainable in the long term and countries will be burdened with high Interest payments.Countries with large interest payments have little left over to spend on investment.

-A current account deficit, may imply that you Are relying on consumer spending, and are becoming uncompetitive. This leads to lower growth of the export sector. 

-A Balance of payments deficit may cause a Loss of confidence by foreign investors. Therefore, there is always a risk, That investors will remove their investments causing a big fall in the value of Your currency (devaluation). This can lead to decline in living standards and Lower confidence for investment.CA deficit is not always harmful because:- A Current account deficit could occur during a Period of inward investment (surplus on financial account). This inward Investment can create jobs and investment.

- With a floating exchange rate a large current Account deficit should cause a devaluation which will help automatically reduce The level of the deficit.

- A current account deficit may just indicate a Strong economy, which is growing rapidly.

CA surplus: producing more than consuming. A country with a current account surplus will have a deficit on the financial / capital account. I.E. A country with a current account surplus will have surplus foreign exchange it can use to invest in other countries.One reason for a current account surplus is when a country has a relatively undervalued exchange rate. This may be a country in a fixed exchange rate. For example, Germany is in the Euro, but due to better German competitiveness than its European neighbours, Germany has had more competitive exports. The German export sector has helped strengthen the German economy.

A country may have a large current account Surplus because of relatively weak domestic demand. This weak demand leads to Lower consumer spending, and lower spending on imports. Therefore, in this Case, domestic employment will suffer from the weak economy.The current account is often cyclical. In a Boom, we see a rise in the current account deficit because consumer spending Rises, leading to an increase in imports. During a boom unemployment falls and Inflation rises.But, In a recession, consumer spending falls leading to lower imports, lower Inflation, and an improvement in the current account. The deficit may convert To a surplus, but this is due to the recession, and therefore leads to higher Unemployment.

Lower interes rates: means bringing down the price of moeny. If we lower interest rates there is no money in the market, so the value of the money decreases.