Australia could be headed for its first trade surplus since early 2014 on the back of surging coal prices, but it's unlikely to be a long-term situation.
The trade deficit fell to a 20-month low of $1.23 billion in September, smashing economists' forecasts of $1.7 billion, according to the Australian Bureau of Statistics.
The 35 per cent, or $667 million, fall was largely on the back of solid commodity prices, particularly coal.
Commonwealth Bank senior economist Gareth Aird said the two per cent jump in exports in the month came as coal spot prices "which have basically been on a rampage since July" continued to rise.
He said the Reserve Bank's index of commodity prices had risen 9.5 per cent in October, which means the deficit should have narrowed further in that month.
"There's a good chance we could post a surplus. If so, it would be Australia's first monthly trade surplus since March 2014," Mr Aird said.
UBS economists said the "super spike" in coal spot prices could end up boosting growth and the Australian dollar.
"If these prices are sustained, there is an increasing prospect of a trade surplus and even larger boost to nominal GDP, which is a support to the Australian dollar," the economists noted.
Citi economists warned that higher commodity prices were likely temporary and a pick-up in global supply would reduce prices back to their previous range by third quarter of 2017.
They said, while the federal budget would benefit to the tune of $5 billion next year, there would be no major revenue revisions in the Mid-Year Economic and Fiscal Outlook due by the end of January.
The economists said a good clue about longevity of the current commodity rally would be what the Reserve Bank said about it in its quarterly Statement on Monetary Policy on Friday.
"Our hunch is that the RBA also views the current commodity price spike as temporary," the Citi economists said.
Meanwhile, services exports rose 0.5 per cent to $6.08 billion in September, boosted by a 14.1 per cent rise in tourism exports to $3.7 billion.
Mr Aird said Chinese holidaymakers had ensured Australia's tourism trade surplus had averaged just over $500 million over the three months to September.
Citi economists said the only downside in the data was the one per cent fall in imports in the month.
They said consumption imports - food and beverages, household electrical goods, transport equipment, textiles, clothing and footwear - were down the third month in a row.
"We suspect the trend decline across a number of consumption categories reflects ongoing weak domestic demand growth," the Citi economists said.
