The Australian economy has seen significant growth.

According to recent data released on Wednesday. The country's trade balance reached a record high in the nine months leading up to March, driven primarily by a rebound in the export of consumer goods due to increased demand following pandemic-related disruptions.

Australia's trade surplus for the month of March was AUD 15.27 billion, according to the Australian Bureau of Statistics, which was higher than the expected surplus of AUD 12.65 billion. This marks a record high for the country's trade balance since the previous high of AUD 17.13 billion in June 2018.

Exports increased by 4% from the previous month with the largest contributor being the recovery in the shipment of metals and mineral ores, which are the country's largest exports. Iron ore and coal, which are Australia's largest export commodities increased by approximately 20% while LNG exports increased by 7%.

Export of consumer goods from Australia has decreased for two consecutive months due to a slowdown in the largest markets, China and Japan. However, an improving economy in China has stimulated increased demand for consumer goods in the past few months.

Exports of agricultural products from Australia such as meat and cereals have also increased in March, contributing positively to the overall trade balance.

Retail sales increased by 0.4% in March, exceeding the expected increase of 0.3% and the previous month's increase of 0.2%. Despite this, high cost of living and a weak economy have kept sales close to their lowest levels in six months.

Consumer spending remains under pressure from consistently high inflation rates and rising interest rates, despite recent data showing a decrease in inflation rates from their 30-year high. Inflation rates still remain relatively high at around 7% in the first quarter of 2023.

Imports to Australia increased by 2% after a rapid decline in the previous month. The increased purchases were primarily in the category of industrial machinery and equipment.

Improved trade balance demonstrates the resilience of Australia's export-driven economy, despite challenges to local economic growth from higher inflation rates and interest rates.

Strong exports may lead to increased economic space for the Reserve Bank of Australia to raise interest rates in the future. However, the central bank may still need to increase interest rates to combat high inflationary pressures.

Technical analysis data (5H)

Resistance: 1.5074, 1.5110, 1.5160

Support: 1.4987, 1.4936, 1.4900

Source: Investing.com

 

Pivot Points May 4, 2023 00:22 PM GMT+7