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What’s up with our mates in The Land Down Under? Certainly not Australia’s trade balance! The most recent trade balance report from the country printed yet another deficit, the biggest one since March 2008. Statistics for November shows that imports outpaced exports by 2.46 billion AUD, bigger than the 2.21 billion deficit that analysts predicted to follow the 2.44 billion AUD deficit that we saw for October 2012.

Digging a little deeper into the report, we see that exports rose by 1% during the month, generating 24.7 billion AUD. The rise was primarily driven by the 6% gain in metal ores and minerals. Meanwhile, imports saw a 2% growth. For the most part, the surge in imports was primarily driven by consumer goods, rising by 3% to 5.81 billion AUD, and transportation equipment (mostly passenger cars) which grew by 9.5%.

Analysts also say that the Australian dollar also contributed to the deficit. The relatively high value of the currency has offset the drop in commodity prices. This is probably why AUD/USD had failed to break last week’s highs. Looking at the 15-minute chart, we can see that the pair even retreated by as much as 40 pips during the Asian session.

AUD/USD 15-Minute Chart

When Australia clocks in consecutive trade deficits you would think that the Aussie would get dumped like there was no tomorrow. But I hang out on Twitter and Facebook a lot and I noticed that market geeks aren’t too worried about Australia’s recent trade numbers. Here are three reasons why:

1. Higher imports AND exports is generally good for the economy.

If you look up the definition of trade deficit on Forexpedia you’ll see that it simply means that the value of imports had outpaced the value of exports. A deficit isn’t necessarily alarming, especially if the rise in imports was driven by consumer goods as it was in this case. It means that consumers are still spending which is a good sign!

Also remember that instead of retreating, exports had actually still risen in November.

2. November’s report doesn’t reflect the recovery in commodity prices.

More specifically, November’s trade report hasn’t taken into account the recovery in prices of iron ore, Australia’s top export product. Iron ore prices dropped to a three-year low in September, but have recently reached 14-month highs thanks to a recovery in Chinese demand and optimism over China’s growth prospects.

3. The RBA is on it

The RBA had cut its interest rates four times last year in order to stem the Aussie’s gains and boost industries unrelated to the mining boom. It’s not hard to imagine the central bank doing more in 2013 if there’s need for more central bank action.

So while the Aussie bulls aren’t exactly opening Champagne bottles, they’re not panicking either. Pay attention to the Australian data coming out in the next days though. If the economic reports continue to disappoint expectations, then the comdoll bears just might get the selloff that they’re waiting for.