| Actual | Previous | Revised | |
|---|---|---|---|
| Balance | NZ$-2,203M | NZ$-963M | NZ$-1,016M |
| Imports - M/M | 1.8% | 8.6% | 9.1% |
| Imports - Y/Y | -1.0% | 8.5% | 8.4% |
| Exports - M/M | -0.9% | 2.4% | 1.7% |
| Exports - Y/Y | -0.1% | 14.3% | 13.2% |
Highlights
New Zealand's merchandise trade deficit widened from NZ$1,016 million in July to NZ$2,203 million in August. This is the biggest monthly deficit since September 2023.
Exports fell 0.9 percent on the month in August after increasing 8.4 percent in July and dropped 0.1 percent on the year after a previous increase of 13.2 percent. Fruit exports rose sharply on the year, but this was outweighed by year-over-year declines in exports of meat, dairy products and forestry products. Exports to Australia, Japan, United States rose on the year, outweighed by declines in exports to China and other major Asian trading partners.
Imports rose 1.8 percent on the month in August, slowing from growth of 9.1 percent in July, and fell 1.0 percent on the year after increasing 8.4 percent previously. Petroleum imports rose at a more moderate pace, offset by further weakness in imports of vehicles and a decline in mechanical machinery and equipment imports. Imports fell on the year from most trading partners with the exception of the United States and South Korea.
Exports fell 0.9 percent on the month in August after increasing 8.4 percent in July and dropped 0.1 percent on the year after a previous increase of 13.2 percent. Fruit exports rose sharply on the year, but this was outweighed by year-over-year declines in exports of meat, dairy products and forestry products. Exports to Australia, Japan, United States rose on the year, outweighed by declines in exports to China and other major Asian trading partners.
Imports rose 1.8 percent on the month in August, slowing from growth of 9.1 percent in July, and fell 1.0 percent on the year after increasing 8.4 percent previously. Petroleum imports rose at a more moderate pace, offset by further weakness in imports of vehicles and a decline in mechanical machinery and equipment imports. Imports fell on the year from most trading partners with the exception of the United States and South Korea.
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.
