| Consensus | Actual | Previous | Revised | |
|---|---|---|---|---|
| Balance | A$11.1B | A$11.791B | A$11.158B | A$10.454B |
| Imports - M/M | 2.5% | 1.6% | 1.7% | |
| Imports - Y/Y | 3.4% | 6.7% | 8.0% | |
| Exports - M/M | 4.4% | -5.0% | -6.4% | |
| Exports -Y/Y | -1.8% | 2.0% | 1.6% |
Highlights
Australia's trade surplus widened to A$11.791 billion in May from A$10.454 billion (revised from A$11.158 billion) in April but it was narrower than a revised A$14.974 billion seen in March. It was larger than the consensus forecast of A$11.1 billion.
In seasonally adjusted terms, the value of exports rebounded 4.4 percent on the month in May after falling a revised 6.4 percent in April. Exports of non-rural goods rose 1.9 percent on the month due to higher volumes of iron ore and coal (their values were down), after falling 6.1 percent previously. Shipments of rural goods gained 5.0 percent after slumping 9.3 percent. Services exports rose 1.4 percent on the month following a 7.8 percent increase. Total exports fell 1.8 percent on the year after rising a revised 1.6 percent in April.
Seasonally adjusted imports rose 2.5 percent on the month in May after rising a revised 1.7 percent in April, as higher purchases of consumption goods and intermediate and other merchandise goods offset lower imports of capital goods. Imports of services were unchanged. Imports rose 3.4 percent on the year after advancing a revised 8.0 percent previously.
In seasonally adjusted terms, the value of exports rebounded 4.4 percent on the month in May after falling a revised 6.4 percent in April. Exports of non-rural goods rose 1.9 percent on the month due to higher volumes of iron ore and coal (their values were down), after falling 6.1 percent previously. Shipments of rural goods gained 5.0 percent after slumping 9.3 percent. Services exports rose 1.4 percent on the month following a 7.8 percent increase. Total exports fell 1.8 percent on the year after rising a revised 1.6 percent in April.
Seasonally adjusted imports rose 2.5 percent on the month in May after rising a revised 1.7 percent in April, as higher purchases of consumption goods and intermediate and other merchandise goods offset lower imports of capital goods. Imports of services were unchanged. Imports rose 3.4 percent on the year after advancing a revised 8.0 percent previously.
Market Consensus Before Announcement
Consensus for goods and services trade in May is a surplus of A$11.1 billion versus April's surplus of A$11.158 billion.
Definition
The Merchandise Trade Balance measures the difference between imports and exports of both tangible goods and services. The level of the international trade balance, as well as changes in exports and imports, indicate trends in foreign trade.
Description
Changes in the level of imports and exports, along with the difference between the two (the trade balance) are a valuable gauge of economic trends here and abroad. While these trade figures can directly impact all financial markets, they primarily affect the value of the Australian dollar in the foreign exchange market. Imports indicate demand for foreign goods while exports show the demand for Australian goods in its major export market China and elsewhere. The currency can be sensitive to changes in the trade balance since a trade imbalance creates greater demand for foreign currencies. The bond market is also sensitive to the risk of importing inflation. A word of caution -- the data are subject to large monthly revisions. Therefore, it can be misleading to form opinions on the basis of one month's data.
