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Tuesday, 6 June 2017


Well, there you go. 

With net exports set to subtract 0.7ppts from GDP growth this quarter, and public demand also undershooting expectations, there's a fair chance that the quarterly GDP print for March will be stone dead flat, or even negative. 

It's a well-worn cliché , but this really underscores how GDP needs to be considered in conjunction with other measures.

With a huge surge in commodity prices - and a 6.6 per cent quarterly jump in the terms of trade - Australia got tentatively close to recording a current account surplus in the March quarter for the first time since 1975.

Alas, it was not to be! Close, but no cigar. 

The current account deficit narrowed by 11 per cent to $3.1 billion.

In the second quarter, the terms of trade will follow commodity prices sharply back down.

It looks as though Australia is also attempting to pare back its reliance on net foreign debt.

The Reserve Bank of Australia (RBA) will leave the cash rate on hold today at 1.50 per cent, but in light of this information it will be interesting to see if any dovish wording makes its way into the statement.