Australia’s August trade surplus rises to record high, what was the major driver?

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Australia’s August trade surplus rises to record high, what was the major driver?

Australia’s trade surplus rose to a record level in August, clearly beating market forecasts.
Image source: © Tomwang112 | Megapixl.com

Highlights

  • Australia’s trade surplus rose to a record level in August, clearly beating market forecasts.
  • According to Australian Bureau of Statistics (ABS) data, the merchandise trade surplus swelled to AU$15.1 billion (US$11 billion) in August, compared to AU$12.7 billion last month.
  • The market consensus was AU$10.3 billion.

Australia’s trade surplus rose to a record level in August, clearly beating market forecasts. According to Australian Bureau of Statistics (ABS) data, the merchandise trade surplus swelled to AU$15.1 billion (US$11 billion) in August, compared to AU$12.7 billion last month. The market consensus was AU$10.3 billion.

The unexpected rise in trade surplus was due to strength in liquefied natural gas and coal exports, which counterbalanced the weakness in iron ore prices, a windfall to mining profits and tax receipts.

The exports climbed 4% month over month to a new high of AU$48.52 billion, amid strengthening foreign demand in the aftermath of disruptions due to the COVID-19 pandemic and rising commodity prices. On the other hand, the imports declined 1% to AU$33.45 billion.

In the eight months of 2021, the trade surplus surged to AU$84.01 billion compared to AU$47.20 billion in the corresponding period of last year.

Meanwhile, on 5 October 2021, ABS said: “From January 2022 reference month, The Australian Bureau of Statistics (ABS) will suspend the production and release of monthly international trade in services statistics in order to focus on enhancing the quality and range of quarterly international trade in services statistics.”

The quality and availability of key source data used in the compilation of international trade in services statistics witnessed a significant impact in past few months due to the ongoing coronavirus pandemic.

“To ensure data is representative and robust, the ABS will be enhancing the production of existing data, exploring new high-quality source data, and reviewing and enhancing existing surveys, methods, processes and systems,” ABS also said.

Retail turnover fell 1.7% to AU$29.3 billion in August.

Image Source: © Dudau  | Megapixl.com

Retail trade

On the other hand, Australia’s retail trade continued to face challenges due to coronavirus pandemic-induced lockdowns. According to the ABS data, the retail sales fell for a third straight month in August.

Retail turnover fell 1.7% to AU$29.3 billion in August, following a 2.7% dip in July and a 1.8 % fall in June.

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