Surplus suffers from rising imports, AUD unchanged

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Australia’s trade surplus is a driver for the AUD and the December figures were released as follows:

Australia Dec. Merchandise/svcs balance A$+8,356 million, s/adj.

Dec goods/services Exports +1 pct MoM, seasonally adjusted.

Australia Dec goods/services Imports +5% MoM, seasonally adjusted.

The data is expected to fall as reopening demand increases both prices and import volumes, Westpac analysts said in a note ahead of the event.

AUD/USD reaction

There has been little reaction to the data this time around as markets have fish to cook, 1. the Reserve Bank released its quarterly monetary policy statement (SMP) and 2. payroll data not agriculture in the United States.

AUD/USD daily chart

Meanwhile, bears are watching for confirmation that the current daily bullish correction may have ended at Thursday’s candle close.

An ideal and classic result would be a bearish engulfing candle like this:

About the trade balance

The trade balance generated by the Australian Bureau of Statistics is the difference in the value of its imports and exports of Australian goods. Export data can provide an important reflection of Australian growth, while imports provide an indication of domestic demand. The trade balance gives a first indication of net export performance. If stable demand in exchange for Australian exports is observed, this would turn into positive growth in the trade balance, and this should be positive for the AUD. Review Alex Nekritin’s article – Trading the Aussie with Australia’s Balance of Trade

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