AIEx News

ABS International Trade data released for the month of June shows that Australian Exports have turned around the $6.0b deficit from 2009-2010 to a surplus of $3.54b which is a $1.72b increase on the revised surplus for May 2010. Exports rose to $26.68b with non-rural goods leading the way with a 13% increase to $18.4b, then rural goods rose 6% to $2.45b and services rose $16m to $4.34b. There were falls in merchandising goods and non-monetary gold, however not enough to unsettle the record growth in the other sectors.

Trade in cotton, meat and meat preparations accounted for large parts of the growth in rural goods and offset the downturn in export of cereal grains and cereal preparations. Iron ore and copper ore were the biggest contributor to non-rural goods at 23% growth thanks to China and India and travel services was up $13m indicating that even during a GFC our Australian travel providers are still enticing international tourists down under.

Between May and June imports rose $57m to $23.14b and preliminary ABS estimates show the volume of goods imported increased 3.5% during the June quarter. The leader in the growth of imports was intermediate merchandise goods such as fuel lubricants, industrial supplies and textile yarn increasing by 5% in the period to $7.99b. Imports of capital goods rose 3% to $4.4b however consumption goods and import of services only rose 1% each to $5.61b and $4.73b respectively.

Economic experts have reported that overall exports climbed 7.1% in June alone a 32% rise from the same month last year. In contrast, imports rose just 0.2 per cent in June. In the next quarter should exports remain strong they could have a significant contribution to GDP growth after several quarters of drag and the current account deficit could shrink. These circumstances all suggest a strong economy which means however an upward change in interest rates is likely in the future.