Monday 10th June 2019
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New Zealand's wholesale trade lifted in the March quarter after falling in December and may add to the view that first-quarter economic growth held up better than expected.
Seasonally adjusted sales rose 0.7 percent in the three months to March 31, following a 0.2 percent decline in the December quarter, Stats NZ said.
Four of the six wholesale industries lifted in the quarter. The biggest increase was in machinery and equipment, up 2.2 percent, or $118 million. The category includes agricultural and construction machinery, computers, and electrical and electronic goods
“The machinery and equipment wholesaling industry bounced back after a softer than usual December quarter,” said wholesale trade manager Sue Chapman.
Wholesale trade covers intermediary transactions between manufacturers and retailers, which feed into the national accounts and is used by economists to predict wider economic activity.
Last week, economists were surprised by stronger-than-expected building work in the first quarter and ASB Bank bumped up its preliminary economic growth forecast after that data. It now expects the economy grew 0.6 percent on quarter in the first quarter versus its prior forecast of 0.4 percent.
In the March quarter, basic material wholesaling had the second largest increase, up $68 million or 1.1 percent. Basic material includes agricultural supplies, hardware goods, petroleum, timber, and metal and mineral wholesaling.
Grocery, liquor, and tobacco products had the largest decrease in sales value in the latest quarter, down $32 million or 0.4 percent.
Inventories were up 7.6 percent on the year and the total value of wholesale trade stocks held at March. 31 was $13 billion, up a seasonally adjusted 1.2 percent from the prior quarter.
Stocks rose in all six industries, with machinery and equipment up 11.1 percent on the year and other goods up 7.4 percent.
Inventories had risen an annual 9.8 percent in the December quarter and 13.3 percent in the September quarter.
Unadjusted wholesale trade sales climbed to $26 billion, up 5.2 percent from a year earlier.
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