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

 


Current Account and IIP - Q3 2001

Data Flash (New Zealand)
Current Account and IIP - Q3 2001

Current Account (Q3)

A current account deficit of $1.7 billion was recorded for the September quarter, in line with market expectations.

The annual deficit reduced from 3.9% of GDP ($4.5 billion) to 3.4% ($3.9 billion).

Over the past year the current account deficit improved by $3.3 billion, driven by a $3.5 billion increase in the trade surplus and a $0.3 billion reduction in the services deficit. The investment income deficit provided a partial offset, widening by $0.5 billion. The latter is consistent with the funding cost of the previous year`s current account deficit.

In seasonally adjusted terms, the current account deficit increased somewhat. Annualising the quarterly seasonally adjusted result, the deficit rose from 2.0% to 2.3% of GDP in Q3.

There was no market reaction to this release.

International Investment Position (30 September 2001)

New Zealand's net international liabilities (external balance sheet including debt and equity) rose from $86.8 billion to $87.9 billion. That was less than the estimated increase in nominal GDP, causing the ratio of net liabilities to GDP to fall from 75.6% to 75.0%.

The rise in net international liabilities of $300 million over the past year compares to a current account deficit of $3,900 million over the same period, suggesting valuation changes of $3,600 million in New Zealand's favour.

Comment

Today's data confirmed the positive trend evident in New Zealand's external accounts over the past year. International concerns about persistently high current account deficits and an unsustainable trend for external liabilities have largely disappeared, removing one of the key negative fundamentals from New Zealand's macroeconomic scorecard.

For the calendar year 2001 we expect the ratio of current account deficit to GDP to fall below 3%. However, that will be a function of a lower Q4/01 deficit replacing a high Q4/00 in the calculation of the annual figure. The underlying trend is likely to confirm that the deficit has already bottomed. That will be shown by a further rise in the seasonally adjusted quarterly deficit.

Even though we expect the combination of worsening terms of trade (due to weaker commodity prices) and lower export volumes (including the tourism sector) to produce a renewed rise in the current account deficit during 2002, we expect that trend to be modest, leaving the current account GDP ratio below 4% over coming years. Such a development would confirm the structural improvement of New Zealand's external accounts associated with the significant downward adjustment of the real exchange rate.

Ulf Schoefisch, Chief 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

 

Onetai Station: Overseas Investment Office Puts Ceol & Muir On Notice

The Overseas Investment Office (OIO) has issued a formal warning to Ceol & Muir and its owners, Argentinian brothers Rafael and Federico Grozovsky, for failing to provide complete and accurate information when they applied to buy Onetai Station in 2013. More>>

ALSO:

Tomorrow, The UN: Feds President Takes Reins At World Farming Body

Federated Farmers president Dr William Rolleston has been appointed acting president of the World Farmers’ Organisation (WFO) at a meeting in Geneva overnight. More>>

ALSO:

I Sing The Highway Electric: Charge Net NZ To Connect New Zealand

BMW is turning Middle Earth electric after today announcing a substantial contribution to the charging network Charge Net NZ. This landmark partnership will enable Kiwis to drive their electric vehicles (EVs) right across New Zealand through the installation of a fast charging highway stretching from Kaitaia to Invercargill. More>>

ALSO:

Watch This Space: Mahia Rocket Lab Launch Site Officially Opened

Economic Development Minster Steven Joyce today opened New Zealand’s first orbital launch site, Rocket Lab Launch Complex 1, on the Mahia Peninsula on the North Island’s east coast. More>>

Earlier:

Marketing Rocks!
Ig Nobel Award Winners Assess The Personality Of Rocks

A Massey University marketing lecturer has received the 2016 Ig Nobel Prize for economics for a research project that asked university students to describe the “brand personalities” of three rocks. More>>

ALSO:

Nurofen Promotion: Reckitt Benckiser To Plead Guilty To Misleading Ads

Reckitt Benckiser (New Zealand) intends to plead guilty to charges of misleading consumers over the way it promoted a range of Nurofen products, the Commerce Commission says. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news