Trade data shows flat economy – but it's not all bad
The "rebalancing" of our imports appears to be happening, albeit slowly.
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Trade data out today confirms a flattening economy – but there is some good news in the mix.
Exports and imports are down for the June quarter, according to the latest merchandise trade figures released by Statistics New Zealand.
On a seasonally adjusted basis, exports are down 1.6% and imports dipped 1.9% for the quarter.
The drop in exports is due mostly to a fall in the value of dairy products, while the slump in imports is driven mostly by a drop in the always-volatile oil and petroleum goods.
On a trend basis, exports have decreased in the last three quarters, while imports have been rising since the September 2009 low, although they are still below their peak of September 2008.
The data is not all bad: the final month of the quarter saw an uptick in both sectors. Whether this is the start of a turnaround or a monthly blip in the highly volatile trade data will not be clear for some time.
However, there are other grounds for optimism.
One is that the "rebalancing" of our imports appears to be happening, albeit slowly.
Imports of capital equipment by businesses continue to rise. Plant and machinery imports were up 13% for the June month and 25.3% for the year.
Consumption goods importation rose 5.2% over the year.
On a country basis, the main factors were a large rise in exports to China, up $220 million for the month, mostly because of a doubling in the value of log exports.
We also sent more goods to Japan – the value was up by $68 million.
Exports to Australia, New Zealand's largest trading partner, are down by $30 million, perhaps reflecting a slowing economy across the Tasman.
Rob Hosking
Wed, 25 Jul 2012
Wed, 25 Jul 2012
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
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Trade data shows flat economy – but it's not all bad
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