NZ trade deficit worse than expected in July

By NZPA

Tuesday 27th August 2002

New Zealand's merchandise trade balance slumped into the red in July, Statistics New Zealand said today.

The preliminary figures, based mainly on imports, showed the trade balance was $226 million in deficit, compared with analysts' forecasts of a much smaller $57 million deficit.

Exports in July were estimated at $2.57 billion and imports at $2.8 billion.

For the year to July, Statistics NZ (SNZ) estimated the trade surplus at $257 million, against analysts' expectations of a $430 million figure. More detailed statistics for merchandise exports will be released on September 5.

The government agency said imports fell by 1.3 percent in the year ending July, compared with the previous year.

The value of exports is now declining at a faster rate than imports, leading to a trade deficit, rather than the surpluses recorded earlier in the year, SNZ said.

The monthly trade deficit was estimated to be 8.8 percent of exports in July -- only the third time in a decade it has exceeded eight percent in that month, SNZ said.

Excluding items individually valued at $100 million or more, such as large aircraft and ships, the annual decrease in merchandise imports was 0.2 percent.

Car imports, mainly from Japan, recorded their highest ever monthly value at $293 million.

The New Zealand dollar declined by 3.2 percent in July on a trade-weighted-index basis. It is still 10.7 percent higher than in July 2001, however.

The local unit also fell against all its major trading partners, except the Australian dollar, during the month.

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