Q1 Balance of
Payments and Net Export data from Australia today, Tuesday 5 June
These are important
data points as they provide inputs into the GDP data due Wednesday.
Yesterday we got the ‘inventory’ input, which blew past
expectations and triggered AUD buying. Check out more on this here:
So, yeah – watch
out for this data today.
Australia Balance of
Payments Current Account for Q1
- expected AUD -9.9bn,
prior AUD -14.0bn
Net exports Q1
- expected 0.5%, prior
Preview via ANZ:
We think the current
account deficit narrowed to AUD10.5bn in Q1 (2.3% of GDP) from
AUD14.0bn (3.1% of GDP) in Q4. This largely reflects the turnaround
in the trade balance, which swung from an AUD1.0bn deficit in Q4 to a
surplus of AUD4.0bn in Q1. We expect the net income deficit to have
We expect net
exports to have added a solid 0.4ppt to GDP growth in Q1 after 0.5ppt
subtraction in Q4. We expect export volumes to have bounced 3.2% on
strong resources exports, and import volumes to be 0.9% higher.
Also we’ll get Q1 ‘public demand’ data, another input.
I haven’t seen an expected survey on this. But, via Westpac (forecast +1% after the previous +1.1%):
Public demand is a key growth driver, expanding at a well above trend pace in 2015, 2016 and 2017, with annual growth at 4.8%, 5.6% and 4.9%, respectively. Momentum is set to extend in to 2018 and beyond.
- An upswing in public investment is underway, lifting from recent lows, as governments commit to additional projects (particularly transport infrastructure) now that earlier fiscal pressures have receded. In addition, spending on health is increasing at a robust pace, including on the NDIS.
- In Q4, public demand increased by 1.1%, led by a sharp rise in consumption (which accounts for 80% of total public demand), up 1.7%, only partially offset by a modest pullback in the often volatile investment segment, -1.3%.
- For Q1, we expect public demand to expand by 1.0% on higher investment, +3%, as well as a modest gain in consumption, +0.5%.