When is the Aussie Trade Balance and how might AUD react?

Australia’s Trade Balance is coming up at the top of the hour. Analysts at Westpac are expecting a $13.2bn trade surplus, within a whisker of the $13.3bn peaks last July (median forecast $11.7bn).

The analysts forecast export to push higher still in February, +2.2%, up $1.1bn. They note that coal and LNG likely advanced, at higher prices and volumes. I

''Iron ore is expected to ease a little despite higher prices, with shipments soft in the month. Imports dipped in January, -1.6%, after a 13% jump over the previous two months associated with the post delta reopening. For February, a resumption of the uptrend is expected, +2.2%, +$0.8bn, on higher volumes and rising prices.''

What to expect from AUD?

AUD/USD has failed to rally higher despite the Reserve Bank of Australia (RBA) that shifted towards a hawkish pivot as it dropped its ‘patient’ stance on the inflation developments. The monetary policy statement read that the Australian economy remains resilient and spending is picking up following the omicron setback.

AUD/USD rallied to a high of 0.7661 but quickly dropped back to the 0.7480s on a firm US dollar. Unless the surplus surprises in a positive way, the Aussie is likely to remain pressured by the firmness of US yields and the greenback. 

About the Trade Balance

The trade balance released by the Australian Bureau of Statistics is the difference in the value of its imports and exports of Australian goods. Export data can give an important reflection of Australian growth, while imports provide an indication of domestic demand. Trade Balance gives an early indication of the net export performance. If a steady demand in exchange for Australian exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the AUD.
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