Australia’s terms-of-trade falls to new 9-year low

By Leith van Onselen

Within today’s data dump of balance of payments data that feeds into tomorrow’s national accounts release for September was the important news that Australia’s terms-of-trade has fallen another 2.3% (seasonally adjusted) and 2.9% (trend) over the quarter to be down by 10.4% (seasonally adjusted) and 10.9% (trend) over the year (see next chart).

As you can see, Australia’s terms-of-trade has dipped well below the GFC low and is now at its lowest level since June 2006; although it remains well above historical norms and still has much further to fall.