AUSTRALIA has posted its biggest trade deficit since before the global financial crisis, as households and businesses continue to exploit the high dollar by spending on imported goods and services.
Despite a rebound in iron ore exports in November, the nation's trade ledger sank to a $2.6 billion deficit during the month, its widest reading since early 2008.
The result, which was Australia's fourth biggest trade deficit, was caused by a $478 million jump in imports, including consumer products and business goods.
Helped by the buoyant dollar, imports have now risen by 5 per cent in the last year, putting pressure on trade-exposed sectors including retail and manufacturing.
The latest jump in imports more than offset a $285 million increase in exports, while the Bureau of Statistics also revised up the deficit for October by about $350 million.
Despite the large deficit, economists said the nation's trade position was likely to improve over the long term as the resources boom entered a new phase of higher production.
The result had a muted impact on markets, with the dollar drifting slightly lower but still above US105¢ after the figures were published.
A senior economist at the Commonwealth Bank, Michael Workman, said the negative trade balance was a minor concern for many overseas investors, who were still fairly upbeat on Australia's prospects.
"From an offshore perspective, people look at us and say the deficits are relatively low and a large part of the deficit is due to mining investment ... which has a big capital component," he said.
Australia has now posted 11 trade deficits in the row, and Mr Workman said this was acting as a "slight" drag on growth.
But in the longer term, he said the spending on equipment used in mining projects would support stronger export earnings and higher incomes.
Mr Workman said he expected smaller quarterly trade deficits over this year and next as output increased from coal, iron ore and liquefied natural gas projects.
The numbers also contained some positive signs for the nation's biggest export - iron ore. Over the month the value of iron ore exports rose by more than $600 million, and economists say exports probably rose further in December.
In a positive sign for the economy and the federal budget, heavy buying in China has sent iron ore prices above $US150 per tonne this week, after slumping to a low of $US86 in September.
Exports of services such as tourism, which have been affected by the strong dollar, also rose over the month and have now increased by 4.9 per cent over the year.