We Just Found Out One Of The Most Important Numbers In The Australian Economy Was Massively Wrong

Getty/Peter Macdiarmid

The ABS released some surprisingly poor trade data this morning which showed a huge deterioration in the balance on goods and services which came in with a deficit of $1.911 billion against market expectations of a deficit of just $200 million.

More strikingly, the revisions to last month’s announced $122 million deficit saw it increase to a deficit of $780 million. At the same time overall revisions to this year’s trade January to April months) has seen $1.079 billion wiped off the announced surplus from the cumulative $3.412 billion announced for the first 4 months when the ABS released the last set of trade data to just $2.333 when the first 4 months of this are totalled in today’s release.

Combined with the the very large deficit in May this highlights why the RBA Governor said in his statement yesterday:

In Australia, recent data indicate somewhat firmer growth around the turn of the year, but this resulted mainly from very strong increases in resource exports as new capacity came on stream; smaller increases in such exports are likely in coming quarters.

The ABS highlighted that:

In seasonally adjusted terms, goods and services credits fell $1,300m (5%) to $26,681m. Non-rural goods fell $1,184m (6%), rural goods fell $62m (2%) and non-monetary gold fell $61m (6%). Net exports of goods under merchanting remained steady at $0m. Services credits rose $8m.

In terms of the non-rural goods seasonally adjusted fall the ABS said that metal ores and minerals were down $760 million and other mineral fules fell $352 million.

Naturally the Aussie dollar came under pressure after this data and lost around a quarter of a cent against the US dollar. It now sits at 0.9463 which isn’t a bad result all things considered.

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