New Zealand unexpectedly posted a trade deficit in January as exports fell and an airline imported a large aircraft, weakening the local currency.
Imports exceeded exports by NZ$199 million ($167 million), from a revised NZ$306 million surplus in December, Statistics New Zealand said today in Wellington. Economists expected a NZ$167 million surplus, according to the median of 10 forecasts in a Bloomberg News survey.
The local dollar’s 11.4 percent rise from a year ago, the biggest gainer among the Group of 10 currencies, is curbing shipments abroad just as the nation is counting on exports to boost an economic recovery from earthquakes in the South Island city of Christchurch. Reserve Bank of New Zealand Governor Alan Bollard last month said that exchange-rate appreciation was reducing exporters’ returns.
“The high currency will choke off export-sector returns and will impede the economic rebalancing,” Mark Smith, an economist at ANZ National Bank Ltd. in Wellington, said in an e- mailed note. “While January’s statement highlighted the RBNZ’s concerns over the strong dollar, there is little they can do about it.”
The so-called kiwi traded at 83.71 U.S. cents at 11:35 a.m. in Wellington compared with 83.81 cents before the data were released. The nation’s currency gained 6.4 percent last month against the U.S. dollar, the largest monthly gain since May 2009.
The aircraft import, valued at about NZ$214 million, was the second in three months. The statistics agency today published a revised, wider November trade deficit after an imported aircraft worth NZ$224 million which was reported late.
Exports fell to a four-month low of NZ$3.74 billion, near the NZ$3.7 billion median of economists estimates. Exports rose 13 percent from a year earlier.
Commodity prices rose 0.1 percent in January from a year earlier, according to an ANZ National Bank (NBL) index published Feb. 2. After adjustment for currency gains, prices fell 4.4 percent from a year earlier.
The Treasury Department said Feb. 7 that there is a risk of growth in the nation’s main trading partners being weaker this year than predicted in forecasts published late October, citing the impact of Europe’s debt crisis on global demand.
Overseas sales of milk powder, butter and cheese, which make up a third of the all exports, increased 25 percent in January from the year-earlier month to NZ$1.3 billion. December dairy sales were a record NZ$1.35 billion.
Imports fell to a six-month low of NZ$3.94 billion, today’s report showed. Economists predicted NZ$3.51 billion. From a year earlier, imports rose 19 percent.
Crude oil shipments gained 39 percent from January last year as the price rose by more than a fifth, today’s report showed. Vehicle purchases also increased while machinery imports fell.
New Zealand had a trade surplus of NZ$646 million in the 12 months ended Jan. 31, narrowing from a revised NZ$853 million surplus in the year through December but wider than a revised NZ$330 million in November.
To contact the reporter on this story: Tracy Withers in Wellington at firstname.lastname@example.org
To contact the editor responsible for this story: Stephanie Phang at email@example.com