Australia: Trade surplus remains at a near record highs – Westpac
Andrew Hanlan, analyst at Westpac, points out that in July, Australia's trade surplus remained at a near record highs - albeit down from the June peak as the surplus narrowed to $7.3bn, down from the $8.0bn record result for June.
Key Quotes
“This was about mid-way between market expectations and our view (market median $7.0bn and Westpac $7.8bn).”
“Imports were particularly volatile over the period of June and July.”
“The import bill slumped by 3.5%, $1.3bn, in the final month of the 2018/19 financial year. That was almost fully reversed in July, rebounding by $1.0bn, 2.9%. We anticipated a sizeable reversal, albeit not quite this large.”
“Export earnings moved higher still in July, increasing by +0.6% (+$0.3bn). Over the year, exports are up by almost 16%.”
“Over the next couple of months, the trade surplus is likely to be trimmed somewhat. The spike in the iron ore price began to be unwound in August - with spot prices pulling back from around US$120/t to the $85 to $90 mark.”
Author
Sandeep Kanihama
FXStreet Contributor
Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.
