Australia’s trade deficit grew in March, according to the Australian Bureau of Statistics (ABS).
The trade deficit for the month of March was a seasonally adjusted $1.59 billion, a rise of $833 million on last month, blowing out to two and a half year high.
The trade weakness was partly driven by a fall in prices and volumes of mineral exports, including coal and iron ore.
Savanth Sebastian Economist at CommSec says it was due to a combination of factors.
“Not only did we import a lot more goods from overseas, but volumes and prices of key mining exports added to the weaker result,” Sebastian says. “The strength of the Australian dollar has been a key driver in depressing exports and increasing the attractiveness of cheaper imports.”
Paul Bloxham chief economist HSBC Research says there are some tentative signs of rebalancing in the Australian economy.
“We expect it to be further supported by below neutral interest rates and the recent Australian dollar depreciation. This rebalancing is apparent in weaker trade, but stronger retail and housing numbers.”