 Oz trade balance goes into red
(China Daily)
Updated: 2008-07-04 07:45 Australia's trade deficit came in much as expected in May, but April's shortfall was revised to show the first surplus since 2002 thanks to huge price increases for the country's iron ore exports. Investor reaction was muted as the Bureau of Statistics could only estimate the impact of increases in contract prices, some of which have yet to be settled. Yet analysts said there was little doubt that deficits would soon be a thing of the past. "We can say with some confidence that the trade account is likely to be in the black for much of the rest of the year, which is a massive change for Australia," said Brian Redican, a senior economist at Macquarie. "It was only a few months ago we had deficit of A$3 billion." April's trade balance was revised to show a surplus of A$12 million, from the original deficit of A$957 million. The statistician pencilled in a price rise of 61 percent for iron ore, but emphasized that this was just a first estimate. Last week miner Rio Tinto won price rises of up to 97 percent from China's Boasteel, setting a benchmark for other deals, but BHP Billiton is still in talks. The price increases will be back dated to April 1 but the true picture will not be clear until all the deals are inked. Thus while May's trade balance was reported as a deficit of A$965 million, it might not remain that way. Agencies  (China Daily 07/04/2008 page16) |
