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

 


NZ terms of trade fall to 3-year low

NZ terms of trade fall to 3-year low as strong kiwi slices into dairy returns

Dec. 3 (BusinessDesk) - New Zealand's terms of trade fell to a three-year low in the September quarter as the country's strong currency ate into returns from an increasing volume of dairy exports.

The terms of trade, which measures how much imports can be bought with a fixed quantity of exports, fell 3.2 percent in the three months ended Sept. 30, according to Statistics New Zealand. That's more than the 1.8 percent forecast in a Reuters survey of economists. Export prices sank 6.3 percent, ahead of the 3.6 percent expected, while import prices declined 3.3 percent versus an anticipated 2 percent fall.

The falling prices came even as export volumes beat expectations, rising 9.7 percent in the quarter, while import volumes advanced 0.7 percent.

Dairy, which accounts for about a quarter of New Zealand's exports, was the biggest contributor to the falling export prices and rising volumes, with volumes surging 32 percent in the quarter, even as prices sank 13 percent.

"Dairy export volumes are at record levels, after adjusting for seasonal effects," prices manager Chris Pike said in a statement. "Dairy values remain at high levels, even though export prices have fallen for five consecutive quarters."

The New Zealand dollar held back export prices, rising 2 percent on a trade-weighted basis in the quarter, Statistics NZ said. The kiwi recently traded at 82.02 US cents and was at 73.41 on a trade-weighted basis.

Today's figures are the latest in a string of official releases showing New Zealand's economic recovery may have slowed in the second half of the year, and come ahead of the Reserve Bank's monetary policy review on Thursday. Governor Graeme Wheeler is expected to keep the official cash rate at 2.5 percent in what is a benign inflation environment.

The terms of trade in the services sector was unchanged in the quarter, with export and import prices both falling 0.7 percent. The fall in export services was driven by lower prices for air transport, while the decline in imports was influenced by cheaper sea transport.

Import prices for petrol and related products shrank 13 percent in the quarter, the sharpest decline across the industries.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Tourism: China Southern Airlines To Fly To Christchurch

China Southern Airlines, in partnership with Christchurch Airport and the South Island tourism industry, has announced today it will begin flying directly between Guangzhou, Mainland China and the South Island. More>>

ALSO:

Dodgy: Truck Shops Come Under Scrutiny

Mobile traders, or truck shops, target poorer communities, particularly in Auckland, with non-compliant contracts, steep prices and often lower-quality goods than can be bought at ordinary shops, a Commerce Commission investigation has found. More>>

ALSO:

Auckland Transport: Government, Council Agree On Funding Approach

The government and Auckland Council have reached a detente over transport funding, establishing a one-year, collaborative timetable for decisions on funding for the city's transport infrastructure growth in the next 30 years after the government refused to fund the $2 billion of short and medium-term plans outlined in Auckland's draft Unitary Plan. More>>

ALSO:

Bullish On China Shock: Slumping Equities, Commodities May Continue, But Not A GFC

The biggest selloff in stock markets in at least four years, slumping commodity prices and a surge in Wall Street's fear gauge don't mean the world economy is heading for another global financial crisis, fund managers say. More>>

ALSO:

Real Estate: Investors Driving Up Auckland Housing Risk - RBNZ

The growing presence of investors in Auckland's property market is increasing the risks, and is likely to both amplify the housing cycle and worsen the potential damage from a downturn both to the financial system and the broader economy, said Reserve Bank deputy governor Grant Spencer. More>>

ALSO:

Annual Record: Overseas Visitors Hit 3 Million Milestone

Visitor arrivals to New Zealand surpassed 3 million for the first time in the July 2015 year, Statistics New Zealand said today. The record-breaking 3,002,982 visitors this year was 7 percent higher than the July 2014 year. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news