Australian Dollar Skids On Big Trade Surplus Shortfall
- The Australian Dollar’s rollicking week goes on
- Having been saved by GDP data Tuesday, the currency was down again Thursday on a Trade disappointment
- Exports slumped by 8%, but investors should probably bare Cyclone Debbie in mind.
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The Australian Dollar was hit Thursday by news that its April trade surplus was much lower than expected.
It came in at A$555 million (US$418 million), when the markets had hoped for nearly four times that, or A$1950 million. Within that imports slipped by 1% on the month, but exports slumped a horrible 8%.
While these numbers clearly aren’t great news for Australia’s vast export machine, some of the blame for their weakness must probably be pinned on Cyclone Debbie. This huge storm hit North Queensland in late March and early April. But the damage it did to transport infrastructure at some major ports was longer lasting and caused a reported huge drop in scheduled coal exports.
The Australian Dollar has had a wild ride this week. It was smashed early on by by news of a nasty current-account miss, only to rise again as official growth figures managed to top increasingly gloomy forecasts. The slip engendered by Thursday’s data was relatively modest, perhaps as Asian markets look outward to international risk events which include Thursday’s important UK general election, which will decide who gets to handle the Brexit negotiaions.
Still, the next iteration of these numbers will be very closely watched by Aussie Dollar investors, to see whether an unwelcome trend is developing. One thing is certiain, the second-quarter’s trade got off to a rocky start.
--- Written by David Cottle, DailyFX Research
Contact and follow David on Twitter:@DavidCottleFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.