Australia’s Trade Surplus in November Unexpectedly Narrows

Australia’s trade surplus unexpectedly narrowed in November as exports of resources slowed while aircraft imports increased.

Exports exceeded imports by A$1.38 billion ($1.43 billion), from a revised A$1.42 billion surplus in October, the Bureau of Statistics said in a report in Sydney today. The median estimate in a Bloomberg News survey of 10 economists was for a surplus of A$1.65 billion.

The report showed stable demand for Australian exports that were outpaced by an increase in goods and services coming into the country. The Reserve Bank of Australia last month made its first back-to-back interest-rate cuts since 2009 as weaker commodity prices ease inflation pressure.

“A surplus at all in the current environment is a nice thing to have,” said Ben Jarman, a Sydney-based economist at JPMorgan Chase & Co., before the report. “To have that revenue stream holding pretty steady despite slower global growth is a welcome outcome.”

The Australian dollar maintained earlier declines. The currency fetched $1.0337 at 11:32 a.m. in Sydney from $1.0340 before the report and $1.0369 yesterday in New York.

Exports were little changed at A$27.2 billion in November from the prior month, today’s report showed, while imports were also little changed, at A$25.9 billion.

Mining Exports

Exports of metal ores and minerals dropped by A$349 million, or 4 percent, from the previous month, the report showed. A category of imports that includes civil aircraft rose A$576 million, it showed.

RBA Governor Glenn Stevens lowered the overnight cash rate target to 4.25 percent from 4.5 percent on Dec. 6, citing “considerable turbulence” in financial markets and an increased chance of a “further material slowing in global growth.”

An RBA commodity price index released two days ago showed the measure fell to 104.5 in December, the fourth straight monthly drop, to the lowest level since March. The nation’s currency weakened 2.4 percent in November and 0.7 percent last month against its U.S. counterpart.

Traders are betting on a 78 percent chance that Stevens will lower borrowing costs again at the central bank’s next meeting in February, Bloomberg calculations based on cash-rate futures showed before today’s report. Over 12 months, the benchmark will fall 97 basis points, a Credit Suisse AG index based on swaps showed.

The central bank’s next meeting to determine rates is scheduled for Feb. 7.

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