http://business.brisbanetimes.com.au/business/surprise-rise-in-trade-surplus-20090402-9kcd.html
Surprise rise in trade surplus
Chris Zappone
April 2, 2009 - 10:32AM
Soaring gold exports have swelled the trade surplus to $2.1 billion in February, the second biggest surplus on record, but shrinking imports are further evidence of weakening demand in the domestic economy.
Economists had expected the trade surplus to narrow to $700 million amid slowing global demand for Australian resources and falling commodities prices. January's surplus was revised down to $926 million.
"There was a big surprise by non-monetary gold exports,'' said ANZ bank economist Warren Hogan. "That was unexpected.
"That was on the higher gold prices throughout February when it was approaching $US1000 an ounce.''
Exports of goods and services, rose 4%, seasonally adjusted, to $24.9 billion, the ABS said, while imports overall dipped 1%, or $134 million, seasonally adjusted to $22.8 billion.
However, other goods rose 49% to $816 million, driven largely by a 55% jump in gold exports to $784 million.
The dollar rose in reaction to the data, climbing to 70.13 US cents from 69.77 US cents.
Flight to gold
The surge in gold trading was driven by high prices along with rising global demand, as jittery investors bought the precious metal as a hedge against possible inflation hitting the US, as the country's debt spirals to finance economic bail-out packages.
"Removing the gold transaction, exports were up about 1% and imports were down around 4%, which was broadly what we had expected," wrote HSBC chief economist John Edwards. "The big point is that Australian exports steadied in February, after some big falls in the previous few months."
"Much of the earlier decline was in iron ore and coal volumes. Some of that was due to an abrupt but temporary dislocation of the China market," he said. "The import numbers look particularly good."
February's trade surplus marked the seventh consecutive month when the values of goods and services exports outweighed the value of imports into the country....see link to read the rest of the article
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