| Actual | Previous | Revised | |
|---|---|---|---|
| Balance | NZ$-486M | NZ$219M | NZ$94M |
| Imports - M/M | 2.4% | 1.3% | 1.2% |
| Imports - Y/Y | 13.4% | 6.5% | 5.8% |
| Exports - M/M | 10.8% | 3.3% | 2.0% |
| Exports - Y/Y | 28.3% | 17.0% | 14.1% |
Highlights
New Zealand's merchandise trade balance shifted from a surplus of NZ$94 million in December to a deficit of NZ$486 million in January. This compares with a deficit of NZ$1,064 in January 2024 and is the smallest January deficit in five years.
Exports rose 10.8 percent on the month in January after an increase of 2.0 percent in December and surged 28.3 percent on the year after previously advancing 14.1 percent. Exports of fruit, dairy products, forestry products and meat all recorded strong increases. The increase in exports was also broad-based across major trading partners, with exports to Australia, China, Japan, the European Union and the United States all rising on the year.
Imports advanced 2.4 percent on the month in January after increasing 1.2 percent in December and rose 13.4 percent on the year after increasing 5.8 percent previously. Petroleum imports and imports of vehicles, parts and accessories were little changed on the year, but there were strong increases in imports of mechanical and electrical machinery and equipment. Imports rose on the year from most major trading partners with the exception of China.
Exports rose 10.8 percent on the month in January after an increase of 2.0 percent in December and surged 28.3 percent on the year after previously advancing 14.1 percent. Exports of fruit, dairy products, forestry products and meat all recorded strong increases. The increase in exports was also broad-based across major trading partners, with exports to Australia, China, Japan, the European Union and the United States all rising on the year.
Imports advanced 2.4 percent on the month in January after increasing 1.2 percent in December and rose 13.4 percent on the year after increasing 5.8 percent previously. Petroleum imports and imports of vehicles, parts and accessories were little changed on the year, but there were strong increases in imports of mechanical and electrical machinery and equipment. Imports rose on the year from most major trading partners with the exception of China.
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.
