Australia’s current account deficit drops to $2.9 billion

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According to the Australian Bureau of Statistics’ (ABS) latest report, the largest goods and services surplus on record at US$13.6 billion, helped decrease Australia’s current account deficit in seasonally adjusted terms by $3.4 billion to $2.9 billion in Q1 2019

ABS Chief Economist Bruce Hockman said of the record goods and services surplus: “We saw strong goods exports this quarter, with prices up sharply for metal ores and minerals and non-monetary gold. Iron ore is a significant part of the story, owing to domestic factors and broader global supply interruptions pushing prices up.”

The balance on goods and services surplus in Q1 2019 was $13,594 million, a rise of $4,753 million. Exports of goods and services rose $4,239 million (4%) and imports of goods and services fell $514 million. The net primary income deficit widened by $1,192 million to $15,984 million in Q1 2019.

In volume terms, rising exports and falling imports resulted in an expected contribution of 0.2 percentage points to growth in Q1 2019 Gross Domestic Product. In seasonally adjusted chain volume terms, the balance on goods and services surplus increased $1,069 million, widening the surplus to $2,597 million.

Australia’s net international investment position was a liability of $966.1 billion at 31 March 2019, a decrease of $31.8 billion on the revised 31 December 2018 position of $998.0 billion.

Australia’s net foreign debt liability position increased $5.0 billion to $1,099.5 billion. Australia’s net foreign equity asset position increased $36.8 billion to $133.3 billion at 31 March 2019.