|Merchandise trade Balance - level||NZ$-600M||NZ$-649M||NZ$-59M||NZ$-194M|
|Exports - M/M percent change||1.5%||-2.9%||-5.1%|
|Exports - Y/Y percent change||14.0%||1.3%||-0.9%|
|Imports - M/M percent change||11.9%||7.6%||8.6%|
|Imports - Y/Y percent change||4.8%||9.0%||10.0%|
July merchandise trade deficit was NZ$649 million. On the month, exports were up 1.5 percent while imports jumped 11.9 percent. On the year, exports were 14 percent higher while imports were up 4.8 percent.
Fruit exports soared 51 percent while meat exports gained 24 percent on the year with beef up 40 percent. Milk powder, butter, and cheese exports showed little change. Increases in cheese, dairy spreads, and milk protein concentrates offset the fall in milk powder exports. According to Stats NZ, the small rise in dairy export values combined with the falling New Zealand dollar contributed to the rise in total exports value this month.
Goods imports were up 4.8 percent on the year. Consumption goods rose NZ$176 million and capital goods rose NZ$161 million. Intermediate goods declined NZ$96 million, led by crude oil.
The international trade balance measures the difference between imports and exports of both tangible goods and services. Imports may act as a drag on domestic growth and they may also increase competitive pressures on domestic producers. Exports boost domestic production. Trade balance values are calculated by deducting imports (cif) from exports (fob).
Changes in the level of imports and exports, along with the difference between the two (the trade balance) are a valuable gauge of economic trends here and abroad. While these trade figures can directly impact all financial markets, they primarily affect the value of the NZ dollar in the foreign exchange market. Imports indicate demand for foreign goods in New Zealand. Exports show the demand for NZ goods in countries overseas. The currency can be sensitive to changes in the trade deficit run by New Zealand since this trade imbalance creates greater demand for foreign currencies. The bond market is also sensitive to the risk of importing inflation.