Australian Trade Balance Actual -0.09B, Expected 1.60B Previous 2.50B
Release Explanation: The trade balance figure is simply the difference between the amount of export and imports of Australian goods and services for the reported month with Australia and other foreign trade partners. “Subsequently, when exports are greater than imports, or positive net exports, a trade surplus is created. However, when imports are greater than exports, a deficit is created. Simply put, here, there is more money leaving the country than actually coming in”, TheLFB-Forex.com Trade Team said. As a result, the report is taken into heavy consideration as it indicates flow of goods and services and stand as one of the biggest components of the Balance of Payments report.
Trade Desk Thoughts: Australia’s trade balance unexpectedly posted a deficit in April, with a read of -0.09B, well below analysts’ expectations of 1.60B.
The trend estimate of the balance on goods and services was a surplus of $1,369m in April 2009, a decrease of $138m (9%) on a revised surplus in March 2009. In seasonally adjusted terms, the balance on goods and services was a deficit of $91m in April 2009, a turnaround of $2,393m on a revised surplus in March 2009.
Seasonally adjusted, goods and services credits fell $2,760m (11%) to $21,680m. Non-rural goods fell $1,692m (12%), other goods fell $784m (34%) and rural goods fell $320m (11%). Services credits rose $34m (1%).
The fall in non-rural goods largely reflects the falls in the coal, coke and briquettes component, down $619m (15%), and the metal ores and minerals component, down $430m (10%). Prices declines were driving the falls in these components. The largest fall in other goods was in the non-monetary gold component, down $783m (37%).
Forex Technical Reaction: The Australian dollar weakened slightly in the minutes after the release, and has dropped 30 pips since the start of the Asian session.