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Australia's Current Account Deficit Narrows

Published 06/06/2018, 09:41 am
Updated 09/07/2023, 08:32 pm
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Originally published by Rivkin Securities

After declining throughout the morning, US stocks rallied in the afternoon to finish close to flat for the day. The Dow closed down 0.05% and the S&P 500 up 0.07%. Twitter (NYSE:TWTR) climbed 5% following yesterday’s announcement that the stock will be added to the S&P 500.

Yesterday, Australia’s current account data was released. It showed a narrowing in the deficit relative to the prior quarter. A rise in exports contributed to the improvement with a particularity strong gain from liquefied natural gas (LNG) exports. Later in the day the RBA met for its monthly meeting at which it kept interest rates on hold at 1.5% as expected. The RBA is continuing to wait for improvement in inflation and the labour market before making any changes. Today, Australia’s GDP for the first quarter will be released. It is expected to show quarter on quarter growth of 0.9%.

The strong trade data yesterday initially gave a boost to the Australian dollar but it subsequently declined and retested the US$0.76 level. Oil prices hover around US$65.50 per barrel (for WTI) as prices stabilise following a rapid decline from above US$70 per barrel. The US has reportedly asked OPEC to increase production by one million barrels per day as high prices are feeding through to higher petrol prices for US motorists.

Data Releases:

- Australia GDP 11:30am AEST

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