Australia: A surprise surge in the trade surplus – ANZ

ANZ analysts point out that Australia’s trade surplus surged to AUD5.8bn in November, well above their and market expectations.

Key Quotes

“The rise in the trade surplus was from a combination of higher exports and lower imports, up 1.8% m/m and down 2.8% m/m respectively. Stronger resources and services exports drove most of the increase.”

“Total resource exports rose 0.9% m/m in November and are now 3% higher than a year ago. The increase largely reflects higher iron ore exports, which rose 2.1% m/m, as well as LNG, up 0.9% m/m. These rises were partially offset by a sharp decline in non-monetary gold, which fell 6% m/m, continuing the strong decline in the previous month.”

“The RBA’s commodity price index was down 3.8% in November, which suggests that the rise in resource exports was likely due to a rise in volume. Manufacturing exports had a soft month, down 0.3% m/m, which follows the large rise in the previous month. Service exports continued to rise, up 1.1% m/m, leaving them 8.9% higher than a year ago.”

“Consumption imports fell 6.6% m/m, leading the fall in imports. A large part of this was driven by a 20.7% m/m decline in car imports, which are now down over 19% y/y. The capital goods imports figure was the other large fall for the month, declining 3.9% m/m. Fuel imports were down 4.9% m/m, largely reversing the sharp rise the previous month.”