Australia's goods trade surplus narrowed from a revised A$6.892 billion in March to A$5.413 billion in April, below the consensus forecast of A$6.0 billion. These data cover the initial period after the escalation of global trade tensions and market volatility at the start of April.

In seasonally adjusted terms, the value of exports fell 2.4 percent on the month in April, weakening sharply from an increase of 7.2 percent in March, with exports advancing 2.1 percent on the year after a previous increase of 5.7 percent. Imports rose 1.1 percent on the month after falling 2.4 percent previously, with year-over-year growth picking up from 0.5 percent to 3.5 percent.

The surplus is expected at A$6.0 billion versus A$6.9 billion in March as exports stay strong.

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.

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.