| Actual | Previous | Revised | |
|---|---|---|---|
| Balance | NZ$-2,291M | NZ$-1,107M | NZ$-1,177M |
| Imports - M/M | 0.4% | 1.4% | |
| Imports - Y/Y | -8.1% | -15.5% | |
| Exports - M/M | 13.7% | -10.3% | -12.6% |
| Exports - Y/Y | -5.6% | -14.0% | -15.2% |
Highlights
New Zealand's merchandise trade balance widened from a revised deficit of NZ$1,177 million in July to NZ$2,291 million in August. This is the biggest deficit since November 2022. Exports rebounded sharply on the month while imports recorded a smaller increase.
Exports rose 13.7 percent on the month in August after falling 12.6 percent in July and dropped 5.6 percent on the year after a previous decline of 15.2 percent. Exports of meat, dairy products, and forestry products all recorded year-over-year declines, offset by increases in exports of fruits and some manufactured products. Exports to China, Japan, and Australia all fell on the year, offset by year-over-year increases in exports to the European Union and the United States.
Imports rose 0.4 percent on the month in August after advancing 1.4 percent in July and fell 8.1 percent on the year after a previous decline of 15.5 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 Zeeland's sole domestic oil refinery. Performance was mixed across other major categories of imports. Imports fell on the year from, China, Australia, and the United States, offset by increases in imports from the European Union and Japan.
Exports rose 13.7 percent on the month in August after falling 12.6 percent in July and dropped 5.6 percent on the year after a previous decline of 15.2 percent. Exports of meat, dairy products, and forestry products all recorded year-over-year declines, offset by increases in exports of fruits and some manufactured products. Exports to China, Japan, and Australia all fell on the year, offset by year-over-year increases in exports to the European Union and the United States.
Imports rose 0.4 percent on the month in August after advancing 1.4 percent in July and fell 8.1 percent on the year after a previous decline of 15.5 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 Zeeland's sole domestic oil refinery. Performance was mixed across other major categories of imports. Imports fell on the year from, China, Australia, and the United States, offset by increases in imports from the European Union and Japan.
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.
