Trade Balance - Commodity Price Dip Dents Surplus

• The trade surplus narrowed from $1.7 billion in March to $977 million in April, the smallest surplus in four months. The weaker trade position was mostly as a result of a pullback in commodity prices in April.
• Nonetheless, in 16 out of the last 18 months, the trade position has been in surplus, highlighting how the upswing in the global economy since 2017 has supported demand for Australia’s exports.
• Export values fell 2.2% in April, the first decline in six months. Weaker commodity prices impacted negatively on metal ores & minerals, coal, coke & briquettes and non-monetary gold.
• Imports were flat in April. The weakness in imports in the month reflected a 2.3% decline in consumption imports. Consumption good imports have fallen in three out of the last four months, adding to signs that consumer spending growth will remain soft.
• Forecasts for global growth remain solid for this year. This would suggest ongoing support for exports, although uncertainty about trade policies could potentially dent the global recovery. Working in the other direction however, is import growth which is being supported by a recovery in business spending although there are some downside risks to consumer spending.

 

Please see the attached report for more information

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