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Australia’s trade surplus balloons in boost to economy

Australia’s trade surplus balloons in boost to economy

SYDNEY: Australia’s trade surplus rebounded sharply in May as coal shipments recovered faster than expected from cyclone-induced disruptions, putting exports back on track to add to economic growth in the quarter. Combined with recent upbeat reports on consumer and business spending, economic growth now looks likely to have picked up from the March quarter’s disappointing 0.3 percent pace. Thursday’s figures from the Australian Bureau of Statistics showed the trade surplus surged to A$2.47 billion ($1.88 billion) in May, up from a downwardly revised A$90 million in April and more than twice market forecasts of A$1.1 billion. Exports of coal alone jumped 62 percent to a cool A$5 billion as mines rushed to resume shipments after Cyclone Debbie tore up rail tracks in Queensland, one of the world’s biggest coal-exporting regions.

Total exports climbed 8.5 percent to more than recover April’s slump, while imports edged up just 0.7 percent. Crucially for growth, export volumes were strong across the board with hard coking coal up 180 percent, semi-soft coal 58 percent and iron ore fines 5 percent. That suggests net exports made a welcome contribution to gross domestic product (GDP) in the June quarter, having been the biggest single drag on growth early in the year.