Merchandise Terms Of Trade Rise

Overseas Trade Indexes: March 2001 quarter (provisional)

The merchandise terms of trade rose 4.7 per cent in the March 2001 quarter, according to the latest Overseas Trade Indexes released by Statistics New Zealand. A rise in the terms of trade means that more imports can be funded by a fixed quantity of exports. The merchandise terms of trade index is now at its highest level since the March 1990 quarter.

The terms of trade for services rose 4.9 per cent.

The total merchandise exports price index fell 2.8 per cent and the imports price index fell 7.1 per cent in the March 2001 quarter. Excluding crude oil and other mineral fuels, the merchandise imports price index fell 5.7 per cent. Price decreases occurred in most of the main commodities this quarter for exports and imports. The appreciation of the New Zealand dollar, as measured by the Trade-Weighted Index which rose 5.7 per cent in the March 2001 quarter, contributed to the decreases in export and import prices. Moving against the trend were lamb export prices which rose 9.2 percent.

Merchandise export volumes had a seasonally adjusted decrease of 1.7 per cent in the March 2001 quarter. Decreased volumes of meat, forestry products and wool were partly offset by a rise in dairy product volumes.

Merchandise import volumes had a seasonally adjusted increase of 1.1 per cent in the March 2001 quarter. The volumes of consumption goods rose 2.4 per cent, intermediate goods (goods, including crude oil, imported for further processing) fell 0.9 per cent and capital goods (unadjusted) fell 19.5 per cent.

If items valued at $100 million or more each (such as large aircraft and ships) are excluded, the seasonally adjusted total merchandise imports volume fell 0.9 per cent in the March 2001 quarter.

Ian Ewing DEPUTY GOVERNMENT STATISTICIAN

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