- Metals are the main driver of exports; grains and gold Imports driven by travel
- New treasurer is likely to be pleased with an increase in taxation on commodities
Australia’s trade surplus reached new records thanks to high prices for key exports including metals, grains and gold, an outcome that is likely to increase the gross domestic product in the second quarter.
The surplus grew up to A$17.7 billion ($12.3 billion) in June, beating the estimates of economists of $14 billion Australian Bureau of Statistics figures showed that on the fourth of June. Exports rose by 5% while imports grew 1percent because more Australian tourists traveled abroad.
We believe that net exports contributed an increase in second-quarter GDP growth by a significant 1 percentage point, which is in line with our opinion that Australia’s economy is performing better than what many people think,” said Marcel Thieliant who is a senior economist for Capital Economics.
Australia has been able to post monthly trade gains for four and a half years, supported by the sale of coal and iron ore. Australia is also a major exporter for LNG and has also benefited from the soaring prices of the fuel, in addition to grains like wheat amid worries of supply disruptions due to Russia’s conflict with Ukraine.
The data released on Thursday showed that earnings from metals rose to 27% during June, whereas cereals and grains rose 21.1 percent. Australians who traveled abroad boosted the imports of services by 2 billion dollars from an upwardly adjusted A$1.6 billion reported in the month of May.
The numbers will be greeted by the new treasurer Jim Chalmers, who is struggling to control the budget deficit and increase government debt following the fiscal stimulus program to help the economy in the wake of the pandemic. Chalmers will present his inaugural budget on October.