Current Account

The Current Account is the current account balance in the ABS publication Balance of Payments and International Investment Position, Australia. It is published by the ABS (Australian Bureau of Statistics) each quarter in current prices and seasonally adjusted. It records economic transactions between residents and non-residents in goods, services, primary income and secondary income during the three months of the quarter.

It is compiled from multiple surveys and administrative data with no single sample. Sources include the Survey of International Investment and the Survey of International Trade in Services. Series start in 1959. It excludes the capital account, the financial account, stocks of foreign assets and purely domestic transactions.

Data cover the 3 consecutive calendar months of the reference quarter, such as January, February and March for the March quarter. Release is generally on the 1st Tuesday of the 3rd month after the quarter ends, at 11:30am Sydney time. The publication page gives future dates, with holiday shifts as the exception.

The same release also shows capital and financial balances, net errors and omissions, and detailed goods, services and income tables. It shows the investment position and a media release with a quote from the head of International Statistics.

Revisions bring better data for recent quarters each quarter. Periods before the previous financial year are usually revised once a year in the June and September issues. Seasonal factors are re-estimated each quarter, and trend estimates for the last three quarters are revised with new data. The chain-volume reference year is updated each September quarter, and history is revised when sources or methods change.

The balance has 5 building blocks that combine trade, income and transfers.

• Goods balance: Captures items changing ownership at market value, such as meat, cereals, ores, coal and machinery.
• Services balance: Captures services delivered in 12 standard types, such as transport, travel, education, finance and business.
• Balance on goods and services: Adds goods and services balances into the trade subtotal of the current account.
• Net primary income: Captures net returns on labour and capital across borders, including wages, investment profits, interest and reinvested earnings.
• Net secondary income: Captures net current transfers with no return, such as remittances, insurance claims, pensions and food aid.

In the September quarter of 2022, released December 6, 2022, 13 surpluses ended when the balance fell 17.0 billion to a 2.3 billion deficit. Both figures are in current prices and seasonally adjusted. The goods and services surplus stayed at 31.2 billion after falling 11.1 billion, while the primary income deficit widened 6.4 billion to 33.2 billion.

Exports fell 0.2% as floods disrupted mining shipments and farm exports stayed strong, while imports rose 8.2% on travel, fuel and vehicles. Terms of trade fell 6.6% on lower coal and ore prices, and acting head Grace Kim said the record income deficit offset the trade surplus.

1. Goods and services balances: Subtract imports (debits) from exports (credits) for goods and for services. For example, goods exports of 120.0 less imports of 117.8 give 2.2, while services exports of 30.0 less imports of 37.3 give negative 7.3.
2. Double-entry accounting: Every transaction has two equal entries, and the goods and services balance sums both balances. For example, 2.2 plus negative 7.3 gives negative 5.1.
3. Net income: Subtract debits from credits for primary income and for secondary income. For example, negative 5.1 plus negative 21.9 plus negative 0.3 gives a 27.3 current account deficit.
4. ARIMA modelling: Estimate seasonal factors each quarter with the concurrent method, so adjusted history is revised. Derive trend with a 7-term Henderson moving average.
5. Chain volume measures: Remove price effects from current prices with trade price indexes. The implicit price deflator equals current prices divided by chain volume.
6. Terms of trade: Divide the export deflator by the import deflator and multiply by 100. For example, 100.6 divided by 106.1 times 100 gives 94.8, which is not part of the balance.