Daily Commentary BY THE CURVE TEAM –

China Hits Australian Exports Again

15th of December, 2020

Reports have emerged that China have hit another Australian export with bans.

Already barley and wine have headlined various restrictions imposed on Australian exports. The restrictions have ranged from bans to tariffs but have only impacted a relatively small share of Australia’s exports.

Coal is now being targeted, which is Australia’s third largest export. In 2018-19 Australia exported $14 billion worth of coal to China.

This will be an economic hit to both countries, as China will need to source its coal from other countries. If the ban is arbitrary or simply politically motivated it would put China in violation of globally agreed trade standards.

As opposed to this geopolitical tension, New Zealand and Australia are demonstrating co-operation. Both countries expect a travel bubble will be available at some point in Q1 of 2021.

This would bring back a key industry that has been missing for much of this year- tourism. Should vaccine dispersion go as planned more travel agreements between countries should emerge.

Today, the RBA minutes from the December board meeting are released, as well as weekly payrolls data for the end of November.

Josh Stewart

Associate - Money Markets