Australia’s international trade deficit has narrowed for the fourth consecutive month as mining and resources exports increase.
The deficit on goods and services was $118 million in November, down on October’s deficit of $358 million, the Australian Bureau of Statistics said on Tuesday.
Economists had expected a deficit of $300 million in November.
During the month, exports were flat, while imports were down one per cent.
JP Morgan economist Tom Kennedy said the flat result for total exports hides the fact that resources exports have been strengthening.
“Exports were unchanged and that’s because of a combination of some pretty weak export data from the coal sector but it was offset by some pretty strong iron ore exports and some rural goods exports.
“If you look at the export volumes data, it does look like there’s been a bit of a ramp-up in the past few quarters, and that’s something we think will continue as more iron ore exports and LNG production capacity comes online.
“That will be a key driver for GDP (gross domestic product) growth in 2014, as it was in 2013.”
The narrowing of the trade deficit was driven by revisions to the October figures as well as a decline in imports, ANZ economist Dylan Eades said.
“We did see a bit of decline in the value of imports,” Mr Eades said.
“It was really mostly driven by consumption goods and services imports which resulted in a bit of a narrowing in the deficit.
“Exports were broadly flat but we did see a mild increase in both rural goods and also resources exports as well.”