| Actual | Previous | Revised | |
|---|---|---|---|
| Balance | NZ$-1,107M | NZ$9M | NZ$-111M |
| Imports - M/M | 1.4% | -6.3% | -6.6% |
| Imports - Y/Y | -15.5% | -14.4% | -14.5% |
| Exports - M/M | -10.3% | -1.7% | -3.3% |
| Exports - Y/Y | -14.0% | 1.3% | -0.7% |
Highlights
New Zealand's merchandise trade balance widened from a revised deficit of NZ$111 million in June to NZ$1,1107 million in July. Exports declined sharply on the month while imports rebounded from a previous fall.
Exports fell 10.3 percent on the month in July after falling 3.3 percent in June and dropped 14.0 percent on the year after a previous decline of 0.7 percent. Exports of meat, dairy products, and forestry products all recorded large year-over-year declines, offset by solid increases in exports of fruits and some manufactured products. Exports to China, Japan, and the European Union all fell on the year, offset by year-over-year increases in exports to Australia and the United States.
Imports rose 1.4 percent on the month in July after falling 6.6 percent in June and fell 15.5 percent on the year after a previous decline of 14.5 percent. Imports of diesel and petrol again fell sharply on the year, reflecting the base effects of a surge last year following the closure of New Zealand's sole domestic oil refinery. Most other major categories of imports also recorded sizeable declines. Imports fell on the year from China, Australia, and Japan, offset by increases in imports from the European Union and the United States.
Exports fell 10.3 percent on the month in July after falling 3.3 percent in June and dropped 14.0 percent on the year after a previous decline of 0.7 percent. Exports of meat, dairy products, and forestry products all recorded large year-over-year declines, offset by solid increases in exports of fruits and some manufactured products. Exports to China, Japan, and the European Union all fell on the year, offset by year-over-year increases in exports to Australia and the United States.
Imports rose 1.4 percent on the month in July after falling 6.6 percent in June and fell 15.5 percent on the year after a previous decline of 14.5 percent. Imports of diesel and petrol again fell sharply on the year, reflecting the base effects of a surge last year following the closure of New Zealand's sole domestic oil refinery. Most other major categories of imports also recorded sizeable declines. Imports fell on the year from China, Australia, and Japan, offset by increases in imports from the European Union and the United States.
Definition
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).
Description
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.
