| Consensus | Actual | Previous | Revised | |
|---|---|---|---|---|
| Balance | A$10.9B | A$10.959B | A$11.437B | A$11.764B |
| Imports - M/M | 4.8% | -7.9% | -8.4% | |
| Imports - Y/Y | -5.6% | -3.9% | -4.1% | |
| Exports - M/M | 1.8% | 1.7% | ||
| Exports -Y/Y | -6.3% | -7.5% | -7.8% |
Highlights
Australia's balance of trade in goods narrowed from A$11.764 billion in November to A$10.959 billion in December, close to the consensus forecast of A$10.9 billion. Exports recorded steady growth while imports rebounded sharply from a previous decline.
In seasonally adjusted terms, the value of exports rose 1.8 percent on the month in December after advancing 1.7 percent in November. Exports of non-rural goods recorded slower growth, while exports of rural goods increased modestly after a previous decline. Exports fell 6.3 percent on the year in December after dropping 7.8 percent in November.
Seasonally adjusted imports rose 4.8 percent on the month in December, strengthening sharply from an decline of 8.4 percent in November. This improvement was broad-based across categories. Total imports fell 5.6 percent on the year in original terms in December after dropping 4.1 percent in November.
In seasonally adjusted terms, the value of exports rose 1.8 percent on the month in December after advancing 1.7 percent in November. Exports of non-rural goods recorded slower growth, while exports of rural goods increased modestly after a previous decline. Exports fell 6.3 percent on the year in December after dropping 7.8 percent in November.
Seasonally adjusted imports rose 4.8 percent on the month in December, strengthening sharply from an decline of 8.4 percent in November. This improvement was broad-based across categories. Total imports fell 5.6 percent on the year in original terms in December after dropping 4.1 percent in November.
Market Consensus Before Announcement
Consensus for international trade in goods in December is a surplus of A$10.9 billion versus November's higher-than-expected A$11.4 billion surplus that saw monthly imports fall sharply and monthly exports rise.
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.
