FXstreet.com (Barcelona) - The Australian trade deficit shrunk to AUD427m in December vs AUD800m expected and AUD2788m in November, with imports down by 6%, "with a big 19% fall in capital goods imports" notes NAB economist Spiros Papadopoulos. Exports also showed positive numbers, rising by 3%, "boosted by gains in iron ore and coal exports" Spiros adds.
Looking at the potential consequences this data may have on the RBA, Mr. Papadopoulos adds: "The smaller deficit will be welcomed, but the fall in capital imports further highlights that domestic investment growth is slowing. With the non-mining sectors also holding back on investment, it’s another sign that the RBA will have to ease further through 2013 to support growth."
Looking at the potential consequences this data may have on the RBA, Mr. Papadopoulos adds: "The smaller deficit will be welcomed, but the fall in capital imports further highlights that domestic investment growth is slowing. With the non-mining sectors also holding back on investment, it’s another sign that the RBA will have to ease further through 2013 to support growth."
