New Zealand's merchandise trade deficit widened from NZ$796 million in February to NZ$1,273 million in March. Exports and imports both rebounded strongly on the month after sharp declines previously, with the weakness in February largely reflecting the impact of disruptions to trade flows caused by severe tropical cyclones during the month. Officials note that export volumes remain impacted as infrastructure is repaired but that values have been supported by price increases.

Exports rose 8.4 percent on the month in March after falling 10.6 percent in February with year-over-year growth strengthening from a decline of 2.5 percent to an increase of 0.6 percent. Exports of meat, dairy products and forestry products all fell on the year, but this was outweighed by increases in exports of fruit, vegetables, and several second-tier export categories. A one-off export of a maritime vessel also boosted headline export growth. Exports to Australia, the United States, and the European Union rose on the year, offset by declines in exports to China, Japan, and South Korea.

Imports rose 12.0 percent on the month in March after falling 11.0 percent in February, while year-over-year growth rebounded from a decline of 0.8 percent to an increase of 10.2 percent. Imports of petroleum and products again rose very strongly on the year, reflecting the impact of the closure of New Zealand's sole domestic oil refinery in April 2022. Other major categories of imports also posted solid growth. Imports from Japan, the United States, and the European Union rose on the year, offset by year-over-year declines in imports from Australia and Japan.

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.