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NZ's seasonally adjusted January deficit $791m versus an expected $300m deficit

Wednesday 27th February 2019

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New Zealand recorded its highest January deficit on record and the seasonally adjusted deficit was also more than double what economists had been expecting as a fall in exports outstripped their forecasts.

The January trade deficit was a seasonally adjusted $791 million, as exports fell 7.8 percent on the year to $4.65 billion and imports lifted 0.4 percent to $5.44 billion, Stats NZ said. 

Economists had been expecting a $300 million deficit in January, with exports tipped to be $4.8 billion and imports seen at $5.05 billion, according to a Bloomberg poll.  

In actual terms, the deficit was $914 million, surpassing the previous record of $894 million in January 2006. Stats NZ noted, however, that as two-way goods trade has nearly doubled since then the January 2019 deficit is equal to 9.0 percent of two-way trade compared with 17 percent in 2006. 

In actual terms imports rose 7.7 percent to $5.3 billion while exports rose 3.0 percent to $4.4 billion. 

Stats NZ said the increase in imports was spread across a range of commodities, with petroleum and products leading the rise – up $81 million, or 13 percent on the year.  

The lift in exports, meanwhile, was led by milk powder, butter, and cheese – up $167 million to $1.5 billion. Exports of milk powder, butter and cheese to China rose $9.1 million from January 2018, to reach $200 million.

The largest fall in exports was for meat and edible offal, down $66 million in January 2019 from January 2018. Lamb exports were down $26 million, while beef exports fell $28 million.

Exports of lamb to the EU were at their lowest January value since 2006, it said. 

The annual deficit was $6.36 billion versus an annual deficit of $6.11 billion in the prior year. Economists had expected a deficit of $5.5 billion, according to the poll. 


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