New Zealand trade gap widens in September to largest on record
WELLINGTON, Oct 25 (Reuters) - New Zealand recorded its widest-ever monthly trade deficit in September, with imports affected by higher oil prices and exports hurt by farming seasonality that was expected to shift in the coming months and shrink the trade gap.
Strong machinery imports in the September figures suggested that weak business confidence figures, which have reached their lowest in nearly a decade, have not hurt investment.
The monthly trade deficit was NZ$1.56 billion ($1.02 billion) in September, the statistics office said on Thursday.
"New Zealand is coming off quite a weak agricultural production season and the new season has started ver y strongly so we expect export volumes to pick up," said Nathan Penny, senior rural economist at ASB Bank.
"We're nearing the point where this is as bad as it gets and we do expect an improvement going forward."
Exports totaled NZ$4.33 billion for the month while imports were NZ$5.89 billion. The data include an increase of NZ$266 million in imports of aircraft and components, which is likely to have a one-off effect on the figures.
Imports of petroleum and related products for the year ended September were $7.1 billion in total, up 39 percent from the previous year. Imports of machinery and equipment such as turbo-jets, propellers, bulldozers, excavators and computers, were up 15 percent.
"One of the things we've been quite keen to keep an eye on was if weak business confidence translates into actual weakness in activity, but at this stage firms are still investing in plant and machinery so no smo king gun on that front," Penny said.
($1 = 1.5328 New Zealand dollars)
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