Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

NZ: Overseas Merchandise Trade (July, Final)

Data Flash (New Zealand)


NZ: Overseas Merchandise Trade (July, Final)

Key Points

A merchandise trade deficit of $42m was recorded in July. A provisional deficit of $46m had been reported on 27 August. The average deficit for July over the past 10 years is $150m. The trade surplus for the year to July was $45m, $20m lower than previously reported due to revisions to earlier data (the June surplus was revised down by $35m).

The value of exports for the three months to July was 19.2% higher than a year earlier. We think that favourable price movements - driven by increases in world prices and the weaker NZD - explain the bulk of this growth, with the volume of exports expanding at around a 3% yoy pace.

The new information in today's release was the composition of export receipts during July which, in aggregate, were stronger than we had expected.

The stronger than expected aggregate result was due mainly to continued strong performance in the dairy sector (eg casein exports are still running 80-90% above year-earlier levels) and a recovery in exports in the forest products sector (possibly reflecting improving activity levels in the Australian construction sector).

Encouragingly, growth in exports of machinery items also appears to be improving with annual growth returning to double-digit levels in July for the first time since March.

The value of imports was unchanged from the estimate published on 27 August. The estimated level of imports for the three months to July was 10.3% higher than a year earlier. Excluding `lumpy' imports of capital transport and military equipment, `core' imports for the 3 months to July were 9.2% higher than a year earlier. Allowing for price movements, core import volumes now appear to be growing at around a 3% annual rate - broadly in line with growth in the overall economy.

Commentary

The deficit in July, which is likely to be maintained over the balance of this year, reflects the beginning of the usual seasonal wind down in commodity exports and gearing up of pre-Xmas imports. The monthly trade balance has bettered its year-earlier level in each of the last 10 months.

?Today's result remains consistent with a trend improvement in New Zealand's current account deficit. We expect the annual deficit to nudge just below 4.0% of GDP in Q2, from 4.8% in Q1. These figures will be reported on 27 September. A further reduction towards 3% of GDP is expected by year-end.

Next Release: August Prov. (27 September). Preliminary Estimate, Trade Balance: -$170m mth/+$246m ann

Darren Gibbs, Senior Economist, New Zealand

This, along with an extensive range of other publications, is available on our web site http://research.gm.db.com

Please do not respond to this mailbox. If you need to update your contact information or request new research, contact your Deutsche Bank Sales Contact.


© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Voluntary Administration: Renaissance Brewing Up For Sale

Renaissance Brewing, the first local company to raise capital through equity crowdfunding, is up for sale after cash flow woes and product management issues led to the appointment of voluntary administrators. More>>

Elsewhere:

Approval: Northern Corridor Decision Released

The approval gives the green light to construction of the last link of Auckland’s Western Ring Route, providing an alternative route from South Auckland to the North Shore. More>>

ALSO:

Media Mega Merger: Full Steam Ahead For Appeal

New Zealand's two largest news publishers have confirmed they are committed to pursuing their appeal against the Commerce Commission's rejection of the proposal to merge their operations. More>>

Crown Accounts: $4.1 Billion Surplus

The New Zealand Government has achieved its third fiscal surplus in a row with the Crown accounts for the year ended 30 June 2017 showing an OBEGAL surplus of $4.1 billion, $2.2 billion stronger than last year, Finance Minister Steven Joyce says. More>>

ALSO:

Mycoplasma Bovis: One New Property Tests Positive

The newly identified property... was already under a Restricted Place notice under the Biosecurity Act. More>>

Accounting Scandal: Suspension Of Fuji Xerox From All-Of-Government Contract

General Manager of New Zealand Government Procurement John Ivil says, “FXNZ has been formally suspended from the Print Technology and Associated Services (PTAS) contract and terminated from the Office Supplies contract.” More>>