Australia’s Trade Deficit Narrowed More Than Forecast in April
Australia’s trade deficit narrowed more than forecast in April as mining exports advanced and imports fell.
The shortfall was A$203 million ($200 million), from a revised A$1.28 billion deficit in March, the Bureau of Statistics said in a report in Sydney today. The median estimate in a Bloomberg News survey of 21 economists was for a deficit of A$900 million.
The Australian economy, which has avoided a recession for two decades, is driven by iron ore and coal sales to meet demand in developing nations from India to China. The Reserve Bank of Australia lowered the nation’s benchmark borrowing cost by 75 points at the past two meetings to 3.5 percent to help shore up demand as fiscal crisis in Europe and weakness in China threaten the global outlook.
“We expect Australia’s trade deficit to have narrowed in April via a rebound in coal and iron ore export volumes,” Andrew McManus, an economist at Australia & New Zealand Banking Group Ltd. (ANZ), wrote in a research report before today’s release. “Ports data for iron ore and coal suggest a rebound in bulk commodity volumes post the supply-disrupted first quarter. Meanwhile, prices of iron ore remained reasonably steady, while coal prices continued to ease during the month.”
Exports rose 3 percent to A$26.1 billion, led by an increase of 10 percent in metal ores and minerals, today’s report showed. Imports declined 1 percent to A$26.3 billion, the report showed.
The Australian dollar was little changed after the report, trading at 98.61 U.S. cents at 11:38 a.m. Sydney time.
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