Record trade surplus, despite exports falling

New Zealand recorded its biggest December month trade surplus since 1991 as imports, particularly of aircraft, fell more sharply than exports.

The trade surplus was $486 million in December, equal to 12 percent of exports, roughly 10 times the average surplus of $49 million for December in the previous five years, Statistics New Zealand says.

The headline result masks an underlying fall in exports for December, led by receipts from dairy products.

Traders expected a $105 million deficit but the kiwi dollar sat unchanged at 83.30 US cents after the data was released in a market awaiting an official cash rate announcement on Thursday.

The surplus is the largest for a December month as a percentage of exports since December 1991.

The strong December surplus helped reduce the trade deficit for the December quarter to $87 million.

Exports fell 5.1 percent in the December month compared to December 2011, reflecting a 5.3 percent fall in the value of exports of milk powder, butter and cheese, a 17 percent fall in exports of logs and wood and wood products, and a 97 percent fall in exports of prefabricated buildings.

The picture was lumpier on the import side, where an 89 percent fall in the value of imports of large aircraft and helicopters from France helped reduce imports in December by 10 percent.

The value of imports of petroleum and products fell by 31 percent but the value of vehicle imports rose by $49 million.

New Zealand had a trade deficit of $1.2 billion in the December year, equal to 2.6 percent of exports.

"This compares with an average deficit of 4.9 percent over the previous five December years, although there were surpluses in the December 2010 and 2011 years," Statistics NZ says.

In the year ended December exports fell $1.7 billion, or 3.5 percent, from a year earlier and imports rose $399 million, 0.7 percent.

(BusinessDesk)

This article is tagged with the following keywords. Find out more about My Tags

Post Comment

3 Comments & Questions

Commenter icon key: Subscriber Verified

Even given the one-off provisions that is actually a pleasing result. Compare our trade performance with that of, for example, the UK, which is in an everlasting and increasing trade deficit.

Reply
Share

A surplus is better than a deficit. But when it's only because one is falling faster than the other it's not really a good look for economic growth as a whole.

Reply
Share

Like it or not, the NZD is not overvalued by the market. That's sad for exporters but good for consumers. The old LTA of about 65 cents USD is long gone. Of course, future events may take it back to that region, but not for the forseeable future. Buy kiwi and sell USD is still a viable thing to do. Hard, but I have done so. In nearly three years of trading I have only made one bad bet and it was an NZD:JPN bet. Had I waited another four days I would have made the loss back, plus $8000.
Yes I pay tax on any gains.

Reply
Share

Post New comment or question

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.

NZ Market Snapshot

Forex

Sym Price Change
USD 0.7959 -0.0001 -0.01%
AUD 0.9075 0.0004 0.04%
EUR 0.6264 0.0040 0.64%
GBP 0.4941 0.0013 0.26%
HKD 6.1735 -0.0023 -0.04%
JPY 85.1880 0.1030 0.12%

Commods

Commodity Price Change Time
Gold Index 1248.5 4.340 2014-10-21T00:
Oil Brent 86.2 0.820 2014-10-21T00:
Oil Nymex 82.5 -0.260 2014-10-21T00:
Silver Index 17.5 0.190 2014-10-21T00:

Indices

Symbol Open High Last %
NZX 50 5233.1 5264.6 5233.1 0.57%
NASDAQ 4359.2 4419.5 4316.1 2.40%
DAX 8693.1 8889.8 8717.8 1.94%
DJI 16406.0 16620.8 16399.7 1.31%
FTSE 6267.1 6372.3 6267.1 1.68%
HKSE 23300.5 23300.5 23088.6 0.62%
NI225 15038.2 15129.1 14804.3 1.59%