Australia's current account deficit doubled in the June quarter, blowing out to $9.6 billion.

Key points: Current account and government spending data has led to upgrades for June quarter GDP

Current account and government spending data has led to upgrades for June quarter GDP Current account deficit doubled to $9.6bn due to lower commodity prices

Current account deficit doubled to $9.6bn due to lower commodity prices Net foreign debt falls below $1 trillion for the first time since December 2015

Lower export commodity prices for the key exports of iron ore and coal were largely responsible for widening the deficit.

While the deficit was wider than expected and more than the revised-up $4.8-billion deficit recorded in the March quarter, a solid increase in export volumes looks like making a positive contribution to second quarter GDP numbers, to be released tomorrow.

On Australian Bureau of Statistics calculations, net exports will add 0.3 per cent to GDP, as opposed to earlier estimates from economists that exports would either be a drag or have little impact on the result.

A separate batch of data from the ABS also had positive news for GDP, with public investment from governments jumping almost 12 per cent over the quarter.

A big part of the rise was in the volatile defence sector, although state governments maintained the recent stronger trend in spending as well.

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By midday (AEST) the dollar was up 0.5 per cent, or just short of 80 cents against the US dollar.

Iron ore prices fell 16 per cent over the quarter, while volumes edged up just 2 per cent.

The value of coal exports fell 15 per cent thanks to both weaker prices and the aftermath of Cyclone Debbie dragging down volumes.

In seasonally adjusted terms, taking into account both price and volume changes, the value of exports fell by $2.7 billion, while imports rose by $1.6 billion.

Australia's term of trade — or the ratio of export prices to import prices and a measure of a nation's spending power — slipped 6 per cent to 103.6 points.

GDP forecasts revised

RBC's Su-Lin Ong said today's releases were stronger than expected, more than outweighing other disappointing components of GDP released in recent days.

Ms Ong said GDP growth over the quarter should now come in at closer to 0.9 per cent — or 1.9 over the year — and while below trend, there were positive signs.

"Firstly, the composition of growth is likely to have been encouraging, underpinned by household consumption, net exports, and some private capex as well as public expenditure," Ms Ong said.

"Secondly, while the quarterly data are choppy, the firmer growth momentum in the quarter is consistent with stronger labour market data and business conditions."

Ms Ong noted that for the first time, in a long time, GDP may exceed Reserve Bank forecasts.

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Deutsche Bank's Adam Boyton was even more bullish arguing GDP may come in at an annualised growth of 2.2 per cent.

"That said, we would expect some pay-back in the coming quarters, such that growth remains in the 2-3 per cent band forecast by the bank over the year to the December quarter 2017," Mr Boyton wrote in a note to clients.

CBA's Gareth Aird said while growth now looks a bit stronger than both market and RBA forecasts, it is unlikely to "shift the monetary policy dial".

"Rates will stay on hold until wages growth and core inflation are on a sustained upward trend," Mr Aird said.

"And while the recent data flow has been encouraging, we think that we are still some way off seeing a lift in economic activity flow through to firmer prices and wages."

The other glimmer of positive news out of the current account data today was the nation's net debt fell 2 per cent, to be back below $1 trillion for the first time in almost two years.