Balance of Payments

Australia’s seasonally adjusted current account deficit narrowed by A$1.3b to A$12.5b in Q4. The improvement in current account balance was driven by a higher trade surplus, which was partly offset by a deterioration in net primary income deficit.

Australia’s seasonally adjusted current account balance rose A$2,202m to -A$14,149m in Q3, from a -A$16,351m in the previous quarter, which was the widest deficit in eight years. The Q3 current account deficit was the sixth consecutive one in a row.

Australia’s seasonally adjusted current account balance fell by A$4,436m to -A$10,725m in Q2, from a revised -A$6,289m (originally -A$4,896m) in Q1. Market participants expected a current account balance of around -A$5,000m.

Australia’s seasonally adjusted current account balance turned back to negative in Q1, dropping to -A$4,896m from the downwardly revised +A$2,667m (originally +A$11,800m) in Q4 2023.

Australia’s seasonally adjusted current account surplus surged A$10,524m to A$11,800m in Q4 2023, from the upwardly revised A$1,276m surplus in Q3 2023. The surge in the current account surplus was due to both an A$8,191m rise in the trade surplus and a A$1,902m narrowing in the primary income deficit. The ABS estimates that net exports added 0.6ppts to real GDP growth in Q4.

Australia’s seasonally adjusted current account balance turned marginally negative in Q3, dropping to -A$158m from +A$7,782m (roughly unchanged from the initial estimate). The A$7,940m drop in the current account balance in Q3 was due to a A$7,975m plunge in the trade surplus, which was marginally offset by a A$395m narrowing in the net primary income deficit.