Australia records first trade deficit since 2017: ABS
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The news: Australia’s current account balance recorded a deficit of $27.1 billion in the March quarter, according to the latest data from the Australian Bureau of Statistics.
The numbers: This latest data represents a $4.1 billion widening from the revised December quarter 2025 current account deficit of $23 billion.
Exports of goods and services fell 1.2% in the March quarter, driven by a 1.2% decline in goods. Imports of goods and services rose 0.8%, led by a 1.5% increase in goods imports, with ADP equipment and fuels and lubricants contributing most to the rise.
Non-monetary gold exports and imports increased 23.7% and 12.9% respectively.
Australia’s net international investment position improved by $62.3 billion to a net liability position of $707.6 billion. The change was driven by an $85.3 billion decline in net foreign equity asset position, reflecting weaker foreign equity markets and a stronger Australian dollar.
The context: ABS head of international statistics Jonathon Khoo said the decrease in the current account was driven by a weaker balance of goods and services, combined with a slight widening in the net primary income deficit.
Khoo said the balance on goods and services fell into deficit for the first time since the December quarter of 2017, while the current account deficit widened for a fourth consecutive quarter.
As a share of nominal GDP, the current account deficit is expected to be the largest since June 2016.
The $5.2 billion decline in net trade is expected to subtract 0.8 percentage points from March quarter GDP growth, due to be published on Wednesday.
What they said: “Volatility in overseas equity markets and exchange rate movements due to the Middle East conflict reduced the value of Australian superannuation investment in overseas equity,” Khoo said.
“This, combined with strong demand by overseas investors for Australian debt, drove Australia’s international investment position to its highest liability level since December 2023,” he added.
