NZ trade balance in surplus
New Zealand’s January trade balance was $8m surplus which is a lot better than the anticipated $271m deficit. Some of the key points:
- Exports $200m stronger than expectations
- Imports were down $60m than expectations
- The lower NZ$ has helped boost trade – exports more price competitive and imports more expensive.
- Encouraging signs for forestry and fruit
- Expansion of capital imports which is indicative of robust domestic demand
- Oil imports reflect lower international prices – oil imports have fallen over $2bn over the past two years. However this has been offset by a reduction in dairy prices.
This has been a booming sector with January arrivals 14% higher than this time last year. Chinese tourists have been the main reason for this as arrivals from China have been setting a strong underlying pace in the region of 30-40% for many months now. The graph below shows visitor arrivals since 1983 and expect a blip next year with the British Lions Tour.
Source: BNZ Economy Watch – 26th February 2016