Australia's trade surplus $2.9bn in November

Australia's trade surplus narrowed to $2.9bn in November from $4.4bn in October, defying expectations to widen to $5bn. Export revenue declined for the first time since August with a 2.9% fall as iron ore saw its weakest month in 4 years (-9.1%). Import spending held broadly flat in the month (0.2%) at record highs.  

November's trade surplus was $2.9bn - its narrowest since August - after outcomes of $4.4bn in October and $3.4bn in September. In the 11 months to November, the trade surplus has averaged $3.9bn, which compares to averages of $5.6bn in 2024, $10.4bn in 2023 and the highwater mark of $13.5bn in 2022. The chart below shows the key dynamic behind narrowing trade surpluses over the past few years has been declining export revenue as import spending has grinded higher.

Exports declined by 2.9% in November ($44.6bn) on the back of falls in non-rural goods (-4.5%) and non-monetary gold (-7.8%). Weakness in non-rural goods mainly reflected a 9.1% decline in metal ores and minerals (iron ore), its largest fall in 4 years. ABS data indicated this was largely driven by weakness in export quantities, though prices were also soft. Non-monetary gold weakened in November (-7.8%) but remained near record highs.   

Import spending edged slightly higher (0.2%) to a new record high at $41.6bn, the level up 12.8% since November 2024. While there were declines in consumption goods (-1.9%) and capital goods (-2.8%) that was offset by a 5.3% rise in intermediate goods. Industrial supplies were the key driver behind the lift in intermediate goods, with rises in processed (14.8%) and primary supplies (117%). 

 

Australian dwelling approvals surge 15.2% in November

Australian dwelling approvals posted their fastest rise in 2½ years surging by 15.2% in November. The key driver was the volatile higher-density segment that saw a 36.3% increase in approvals in the month, while house approvals were up by a modest 0.7%. These outcomes elevated total approvals to their highest since February 2022 coming in at 18.4k in November. RBA rate cuts - 75bps in total in 2025 - rising housing prices and a tight overall supply-demand balance have all likely helped lift approvals, but levels still remain below those seen in past cycles.      

Monthly dwelling approvals rose 15.2% in November to 18.4k. This continues a volatile profile over recent months, often swinging from large gains to declines. The November result follows a 6.1% fall in October, an 11.4% rise in September and declines of 3.7% in August and 10.3% in July. Overall, approvals have averaged out at 17.1k over the 3 months to November - a highwater mark on that basis going back to late 2021. The chart below shows the higher-density segment has driven the recent momentum in approvals. 

 

The high-rise segment in particular looks to be the main driver of the upturn in higher-density approvals. That strength has been evident across a number of capital cities including Sydney, Melbourne and Brisbane. 

Australian CPI 3.4% in November

An improved Australian inflation report in November saw both annual headline and core CPI ease after rising in the prior month. Headline CPI slowed from 3.8% to 3.4%, printing below the 3.6% consensus figure, while trimmed mean or core CPI softened from 3.3% to 3.2%, as expected. Black Friday sales and holiday travel were key contributors to the softer inflation outcomes. The upside risks the RBA has been wary of in the final quarter of 2025 in light of its year-end forecasts for headline CPI of 3.3% and 3.2% for the trimmed mean do not appear to be materialising. The RBA's next rates decision is set for February 3, a meeting at which markets see the odds of a rate hike as unlikely at around a 1 in 3 chance. 

Source: ABS 

For the second month in succession, the monthly change in headline CPI was 0%. In October, base effects lifted the annual rate from 3.6% to 3.8% (headline CPI was -0.2% in October 2024), but in November they drove a decline from 3.8% to 3.4%, after the 0.4% rise from 12 months earlier fell out of the calculation. This highlights the volatility in the monthly indicator and how judgments can swing. The RBA has therefore said its focus remains on the quarterly figures that are due later this month. The more stable trimmed mean came in at 0.3% month-on-month, also the same as in October to leave the annual pace running a little above the top of the 2-3% target band. 

The key insights in today's report were around the effect of the Black Friday sales. Compared to 2024, clothing garments saw a larger discounting effect in 2025 with prices falling by 2.3% in the month (vs 1% in 2024). This was also the case for footwear and furniture, those items down 5.5% and 4.6% respectively in November 2025 to outpace the falls seen in 2024. Accessories were the outlier with prices down by a smaller amount in the 2025 sales (-4.1%) compared to 2024 (-7%). 

The other main driver weighing on headline inflation in November was holiday travel. That came after strong demand during September and October associated with the AFL and NRL finals and school holidays. 

Source: ABS