NZ trade surplus beats expectations supported by stronger export values
Data released earlier today showed that New Zealand posted a trade surplus of $292 million in April, more than the $60 million expected in a Reuters poll and up from $184 million a year earlier. The stronger-than-expected trade surplus gave the kiwi a short-term boost.
Details of the report showed that exports rose 4 percent to $4.3 billion and imports were up 1.5 percent at $4.01 billion. Increased volumes of gold kiwifruit and apples drove up shipments of fruit, the country's fourth-biggest export product, boosting overall export values.
"Our baseline view is still that New Zealand’s trade accounts will deteriorate further over the next 12 or so months. NZD commodity export prices are still falling and with oil prices recovering, this is consistent with our expectation of a further circa 10% fall in the terms of trade over the year.” said ANZ in a report.
Seasonally adjusted export values surged 23% m/m in April. This follows falls of 7.8% and 17.2% m/m in February and March respectively. In fact, the level of March’s seasonally adjusted export values was the lowest since December 2009. Seasonally adjusted import values also lifted solidly in April, increasing 12% m/m (after falls of 6.2% and 7.5% m/m in February and March). In seasonally adjusted terms, a $163m deficit was recorded, smaller than March’s $483m deficit.
"The sharp recovery in export values today is reassuring – the alternative would have presented a worrying picture indeed. We didn’t feel that the weakness in export values in February and March was indicative of the export environment overall and put it down more to timing (due to production, inventories, global conditions etc) rather than anything more concerning. The solid bounce today supports that timing thesis." adds ANZ.