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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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Free AccessModerate Q2 Net Export Contribution As Public Demand Drives Growth
Q2’s current account deficit widened significantly more than expected at $10.7bn compared with $6.3bn in Q1, which was revised up. The net export contribution to GDP was 0.4pp lower than expected at 0.2pp after a 0.9pp detraction in Q1. Government finance statistics showed that public demand contributed 0.4pp to Q2 growth after 0.2pp. GDP prints on Wednesday.
- Q2’s current account deficit was the largest in six years driven by a $5bn narrowing in the merchandise trade surplus, impacted by lower commodity prices, and a widening in the primary income deficit. The services deficit narrowed $1bn.
Source: MNI - Market News/ABS
- The terms of trade fell 3.1% q/q and 3.9% y/y, as export prices fell 3% q/q and imports were unchanged.
- The volume of goods and services exports rose 0.5% q/q and 0.1% y/y in Q2, down from 3.3% y/y, with the increase driven by services (+5.6% q/q) while merchandise fell (-0.5% q/q). Import volumes declined 0.2% q/q to be up 5.2% y/y with the weakness concentrated in goods.
- Goods exports fell 4.4% q/q with both rural and non-rural weaker. Softer prices for iron ore and coal fell for a second consecutive quarter driving the 5.3% q/q & 8% y/y drop in non-rural shipments. Services rose 6% q/q though to be up 11.9% y/y, boosted by the education sector.
- Merchandise imports fell 0.6% q/q with the weakness in mining capex goods, consistent with recent soft investment data. Consumer goods rose 1% q/q after 8.9% in Q1 to be up 5.1% y/y. Services imports rose 1.1% q/q and slowed to 6% y/y.
Source: MNI - Market News/ABS
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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.