Investing.com-- Australia’s trade balance grew more than expected in April, as a drop in key commodity exports was offset by an even bigger decline in imports as local demand soured.
Trade balance grew to a surplus of A$6.55 billion ($4.34 billion), data from the Australian Bureau of Statistics showed on Thursday. The reading was higher than expectations for a surplus of A$5.37 billion, as well as last month’s balance of A$4.84 billion, which was revised lower.
The stronger surplus came even as Australia’s key exports- of metal ores, coal and mineral fuels- fell sharply during the month. This saw the country’s overall exports shrink 2.5% in April from the prior month.
Exports were hit by weakening commodity demand across the globe, chiefly in top market China, which is struggling with a sluggish economic recovery.
But weak local economic conditions saw Australian imports shrink by an even greater margin, with total imports down 7.2% month-on-month in April.
Weak business spending saw the import of capital goods decline sharply, while barring an increase in electronics and automobile imports, shipments of consumption goods also contracted.
The trend comes as the Australian economy cools under pressure from high interest rates and sticky inflation. Gross domestic product data on Wednesday showed the economy grew less than expected in the first quarter of 2024, barely avoiding a recession.