June quarter exports drop, likely to reduce June GDP growth

June quarter figures for Australia’s export and imports show a fall in the value and quantity of exports, in excess of the numbers expected by economists. Analysts had been expecting a current account deficit of around $16bn so the $19bn deficit was something of an unwelcome surprise. A deterioration from March’s revised figure of $13.5bn was expected but a fall of $2.3bn in the goods and services trade surplus and an increase in interest and dividends paid offshore increased the overall deficit. Coal export volumes were down as bad weather delayed shipments although iron ore volumes remained close to the all-time high reached recently. The effects of lower volumes were compounded by a fall in the ratio of export prices to import prices, which declined 3.4% over the quarter and 10.6% over the year. The new figures suggest June quarter GDP growth will be 0.6% lower as a result.