Australia records first current account deficit in 13 quarters

ABS

Australia recorded a $2.3 billion current account deficit in the September quarter 2022, following 13 consecutive quarters of a current account surplus. The balance on goods and services decreased by $11.1 billion but remained in a surplus of $31.2b, while the net primary income deficit widened by $6.4 billion to $33.2 billion in the September quarter 2022. 

Grace Kim, acting head of international statistics at the ABS, said: “The current account deficit reflected a narrowing but robust trade surplus, which was offset by a record high income deficit in the September quarter.”

Imports of goods and services increased 8.2 per cent, with travel services driving the increase as Australians continued to travel overseas after prolonged border closures. The increase in goods imports was driven by fuels and lubricants with diesel the main contributor. Non-industrial transport equipment also rose with high imports of motor vehicles and a notable rise in imports of electric vehicles.

Exports of goods and services decreased 0.2 per cent as shipments of mining commodities were disrupted during the quarter as east coast floods impacted key trading ports. High rainfall throughout 2022 supported strong production and exports of agricultural commodities such as cotton. Exports of travel services increased as arrivals of international students and tourists continued to rise following the re-opening of Australia’s international border earlier in the year.

The Terms of Trade fell 6.6 per cent, driven by a decline in export prices with decreasing coal and metal ore prices. This was partly offset by a rise in mineral fuels due to the price rise in oil-linked contracts and surging global demand. The rise in import prices also contributed to the fall in the terms of trade.

Trade