Australia trade deficit shrinks in December, interest rate decision looming.

February 4, 2008 - Forex Economic News

The Australian trade deficit decreased in December according to data released by the Australian Bureau of Statistics. Australia’s trade balance for December was a seasonally adjusted -A$1.936 billion changed by A$226 million from a revised -A$2.162 billion in November. Helping to decrease the deficit was a 1 percent rise in exports of goods and services. Rural goods exports rose by A$178 million, a 9 percent increase over November while the exports of services increased by A$22 million or a 1 percent increase.

The Reserve Bank of Australia makes its interest rate decision on Tuesday, February 5th. The RBA has provided recent rate increases of 0.25 percent in August and November of 2007, bringing its official cash rate to 6.75 percent. The market expectation is that another rate increase of 0.25 percent is in store tomorrow as the RBA is focused on curbing rising inflation. An Australian cash rate of 7.0 percent would be the highest rate level in 11 years. The Australian dollar is currently trading at 0.9090 per USD.

Tags: AUD Interest Rate, Australia Trade Balance

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