Australia has been able to narrow its international trade deficit to AU$2.9 billion (£1.51 billion) during January 2016.

The nation's seasonally adjusted trade deficit represented an improvement compared to the consensus market forecast of AU$3.2 billion, as well as being down 17 per cent compared to the AU$3.5 billion result from December.

This improvement was achieved after a 1.1 per cent monthly rise in exports was matched by a decline in imports by the same percentage, offering an indication that the country's economic growth prospects remain healthy.

A strong performance by the manufacturing sector helped to drive this deficit reduction, while a nine per cent month-on-month drop in fuel purchases - which coincided with a fall in the price of oil - contributed to driving down imports.

This news will be welcomed after the widening of the Australian trade deficit seen in the second half of last year.

JP Morgan economist Tom Kennedy said: "The combination of decent export shipments and rising prices will support nominal export growth in upcoming prints, helping to narrow the trade deficit."