| Consensus | Consensus Range | Actual | Previous | Revised | |
|---|---|---|---|---|---|
| Balance | A$7.450B | A$7.000B to A$7.500B | A$7.129B | A$6.786B | A$6.184B |
| Imports - M/M | -1.9% | 7.5% | 8.0% | ||
| Imports - Y/Y | 3.9% | -1.7% | -1.5% | ||
| Exports - M/M | 0.4% | -1.4% | -1.8% | ||
| Exports -Y/Y | -11.4% | -14.7% | -15.4% |
Highlights
Australia's balance of trade in goods widened from A$6.184 billion in September to A$7.129 billion in October, below the consensus forecast of A$7.45 billion. Exports rose, largely driven by non-monetary gold, while growth was weaker for all major categories of imports.
In seasonally adjusted terms, the value of exports rose 0.4 percent on the month in October after dropping 1.8 percent in September. This increase in headline exports, however, was largely driven by a sharp swing in exports of non-monetary gold, a volatile category, with exports of rural goods falling after a previous increase and exports of non-rural goods recording weaker growth. Exports fell 11.4 percent on the year in October after dropping 15.4 percent in September.
Seasonally adjusted imports fell 1.9 percent on the month in October, weakening sharply from an increase of 8.0 percent in September. Imports of capital goods and consumption goods fell after previous increases, while imports of intermediate and other merchandise goods recorded slower growth. Total imports rose 3.9 percent on the year in original terms in October after falling 1.5 percent in September.
In seasonally adjusted terms, the value of exports rose 0.4 percent on the month in October after dropping 1.8 percent in September. This increase in headline exports, however, was largely driven by a sharp swing in exports of non-monetary gold, a volatile category, with exports of rural goods falling after a previous increase and exports of non-rural goods recording weaker growth. Exports fell 11.4 percent on the year in October after dropping 15.4 percent in September.
Seasonally adjusted imports fell 1.9 percent on the month in October, weakening sharply from an increase of 8.0 percent in September. Imports of capital goods and consumption goods fell after previous increases, while imports of intermediate and other merchandise goods recorded slower growth. Total imports rose 3.9 percent on the year in original terms in October after falling 1.5 percent in September.
Market Consensus Before Announcement
Australia's trade surplus is seen widening to A$7.450 billion in October after shrinking from A$10.161 billion in August to A$6.786 billion in September, when exports slipped and imports surged.
Definition
The Goods Trade Balance measures the difference between imports and exports of tangible goods. 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.
