Australia's trade surplus came in at $5.4bn in June (vs $3.7bn expected), rebounding from much narrower surpluses in April ($4.2bn) and May ($1.6bn). Exports saw their fastest rise since September 2022, accelerating by 6% in June as non-monetary gold exports surged to record highs on safe-haven demand in a volatile period for financial markets amid uncertainty around the US administration's new tariff regime. Monthly imports slowed with a 3.1% fall after rising by more than 5% over April and May.
The trade surplus was $5.4bn in June, substantially wider than in May ($1.6bn) and comfortably above its level in April ($4.2bn). Collectively, the surpluses of the previous 2 months were revised down by around $1.3bn. This was a particularly volatile period in global trade following the long-awaited announcement by the Trump administration in early April of the United States' new tariff regime. Trade activity was pulled forward to front run the tariffs, leading to a pullback thereafter while uncertainty over tariff rates and timelines saw the US dollar - historically a source of stability in turbulent times - become the driver of volatility in foreign exchange markets. Looking back on the period, monthly trade surpluses averaged $3.7bn in the quarter, a step down from their average in the March quarter ($4.3bn).
June exports lifted by 6% to $44.3bn, up 2.6% on 12 months ago. The standout factor in the month was non-monetary gold (36.7%), which hit a new record high ($5.8bn) as volatile trading conditions and economic uncertainty - as well as increased expectations for rate cuts - drove demand for the safe-haven asset. Non-rural goods also contributed with a 3.1% rise in June as coal (17.3%) and iron ore exports (2.3%) advanced.
Imports weakened in June falling by 3.1% to $39bn but were still up by 3.1% through the 12 months. Capital goods (-9.1%) and consumption goods (-5.5%) saw large declines in the month - though both had risen at pace in April and May.
For the June quarter, export revenue was $129.2bn, essentially held flat (-0.1%) from its level in the March quarter. Last week, the ABS reported that export prices fell by 4.5% in the quarter, with the uncertainty over global trade and the growth outlook weighing on commodity prices. Export revenue holding flat in this backdrop is a decent outcome. For imports, spending rose by 1.5% in the quarter to $118.1bn. Spending on both capital and consumption goods increased by more than 4% for the period. Import prices were clocked declining modestly by 0.8%q/q, unlikely to have given demand any meaningful support.
