(July 2): Australia fell into a surprise trade deficit in May, as exports dropped the most all year, with imports extending a streak of gains caused in part by high fuel prices and data centre demand.
Exports slumped 6.9% in May from April, according to data Thursday from the Australian Bureau of Statistics, while imports rose almost 3%. That left a deficit of just over A$3 billion (US$2.1 billion), the second time the trade balance has been in the red this year and the largest gap since 2015.
The war in the Middle East has caused Australia’s import bill to soar, with the nation spending a record A$8.6 billion just to buy fuel and lubricants in May, the second straight month those purchases have exceeded A$8 billion.
And as companies invest in data centres, imports of the necessary equipment also continue to be elevated, although these were lower than the record hit in March. Australia’s buildout of data centres is one of the world’s biggest, according to HSBC Holdings Plc.
Exports of gold fell by more than A$2 billion and the value of natural gas shipments also declined, helping push down the total sales overseas.
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