I will begin by touching on the latest Reserve Bank of Australia monetary policy decision: no change to interest rates. There have been a few pieces of Australia-specific economic data to believe that higher rates are already starting to bite. But my main point is that the RBA is probably very much concerned about the potential for global growth trends to adversely impact Australia in the second half of the year.

Out today was some positive news for Australia – they turned a trade deficit in March (and an expected trade deficit in April) to a trade surplus. April’s actual surplus of A$134 million was a welcomed surprise, relative to the consensus A$500 million deficit estimate.

The takeaway from this number, per a Reuters article, is that this is the beginning of a sustainable trend that’s going to be a huge boon for Australia’s economy. Here’s what one analyst had to say:

“Today's data provide a reminder of one of our long held themes which we continue to think will underpin above trend growth going forward," said Su-Lin Ong, a senior economist at RBC Capital Markets."

“The recovery in the terms of trade which began in late 2009 is accelerating and will deliver a strong boost to income and demand, assisting in some rotation of growth away from public spending to firmer private sector demand.”

Great! Sure can’t argue that it would be quite a welcomed rotation. And sure can’t argue that Australia has decent potential to see a sustained improvement in their terms of trade. But there’s one thing I can argue – the timing.

The April trade number is already old news. It is June, and in May we witnessed a change in market sentiment that seems very much justified. Unless of course it’s just due to the old adage: “sell in May and go away.” (Though that indeed may be the best decision for some investors.)

It was a 10.7% rise in exports that boosted Australia’s April trade balance. Below is a series of charts showing the value of Australia’s exports to select countries (chosen based on what I had easy access to!). In particular order: lowest to highest total value of Australian exports.

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