Pete Wargent blogspot

Co-founder & CEO of AllenWargent property buyer's agents, offices in Brisbane (Riverside) & Sydney (Martin Place), and CEO of WargentAdvisory (providing subscription analysis, reports & services to institutional clients).

5 x finance/investment author - 'Get a Financial Grip: a simple plan for financial freedom’ (2012) rated Top 10 finance books by Money Magazine & Dymocks.

"Unfortunately so much commentary is self-serving or sensationalist. Pete Wargent shines through with his clear, sober & dispassionate analysis of the housing market, which is so valuable. Pete drills into the facts & unlocks the details that others gloss over in their rush to get a headline. On housing Pete is a must read, must follow - he is one of the finest property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

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"I've been investing for over 40 years & read nearly every investment book ever written yet I still learned new concepts in his books. Pete Wargent is one of Australia's finest young financial commentators." - Michael Yardney, Australia's leading property expert, Amazon #1 best-selling author.

"The most knowledgeable person on Aussie real estate markets - Pete's work is great, loads of good data and charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, and author of the New York Times bestsellers 'End Game' and 'Code Red'.

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Thursday, 8 December 2016

Trade surplus on the way

Deficit continues

Australia recorded another international trade deficit of $1.54 billion in October, an increase of $269 million on September, but a 60 per cent improvement on the prior year comparative. 


These figures will likely be revised positively, though, given that the preliminary estimates for FOB values appear to based on very conservative unit values. 

In fact, preliminary estimates for export values for coal and iron ore fell in October, but with bulk commodity prices exploding into the end of the year, this decline won't persist. 

LNG export values hit a record high, as did services exports. 


The trade services balance has generally been improving, largely thanks to the lower dollar and a surge of international tourism, which is a boost for both Sydney and Queensland. 


The international trade balance may well be in surplus before the calendar year is out.

State versus state

Export values to China have at last moved moderately higher year-on-year, though remaining well down from their peaks. 


Merchandise export values from Western Australia are now steadily improving again, while the recent surge in coal and oil prices should see Queensland racking up records for export values in 2017.


Queensland is now consistently reporting a trade surplus again, which hasn't always been the case in recent years.


The wrap

This was the first time since June that the monthly trade deficit increased, but it's likely that there will be positive revisions and it wouldn't be a surprise to see a trade surplus before long. 

The monthly increase was driven by a 2 per cent increase in imports in the month, while export values increased by only 1 per cent. 

When higher coal and iron prices feed through into the export values, we can expect the trade deficit to be closed.