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Terms of trade rise in the June quarter

Terms of trade rise in the June quarter – Media release

2 September 2013

New Zealand’s terms of trade rose 4.9 percent in the June 2013 quarter, due to rising export prices and falling import prices, Statistics New Zealand said today.

Terms of trade is a measure of the purchasing power of New Zealand’s exports abroad. An increase means that New Zealand can buy more imports for the same amount of exports. The terms of trade rose for the second consecutive quarter but is still 2.5 percent below the 37-year high reached two years ago.

“The terms of trade increase of 4.9 percent reflected higher dairy prices", prices manager Chris Pike said. "Without dairy, the terms of trade would have risen 1.6 percent.”

In the June 2013 quarter:
• export prices rose 3.4 percent
• import prices fell 1.5 percent (reflecting lower prices for crude oil and capital goods)
• seasonally adjusted export volumes fell 6.7 percent
• seasonally adjusted import volumes rose 3.9 percent, influenced by capital goods.

Dairy exports made a significant contribution to both prices and seasonally adjusted volumes, with milk powder being the largest contributor. In the latest quarter, dairy export:
• prices rose 14 percent
• seasonally adjusted volumes fell 18 percent
• seasonally adjusted values fell 6.8 percent.

The price and volume indexes for exports and imports of goods are compiled mainly from overseas merchandise trade data.

OverseasTradeIndexesVolumesJun13qtr.pdf

Tables: otivjun13qtrprovtables.xls
ENDS

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