NZ trade deficit trimmed back in June quarter but more than doubled in a year

Goods exports rose by $1.1 billion, driven by increases in our main export commodities such as fruits. Photo / Paul Taylor

Exports have risen but New Zealand is still recording trade deficits.

The country's seasonally adjusted current account balance was a $7.1 billion deficit in the June 2022 quarter, down $1.7b from the previous quarter.

Despite the deficit narrowing in the autumn and early winter, the country's annual current account deficit was $27.8b in the year to June 30.

That equated to 7.7 per cent of GDP, Stats NZ said. One year ago, the deficit equated to just 3.4 per cent of GDP.

And the deficit revealed today in Stats NZ data was at levels approaching pre-Covid records.

The biggest annual current account deficit before the pandemic was $14.7b in 2008, amounting at the time to 7.8 per cent of GDP.

In the June quarter, the seasonally adjusted goods deficit shrank by $737 million to $2.2b.

Goods exports rose by $1.1b, driven by increases in our main export commodities such as meat and fruits.

Imports rose in value too - but not nearly as much.

Stats NZ said price increases for diesel, petrol, and aviation gas largely propelled a $324m jump in goods imports to $20.1b.

New Zealand's net international liability position in the latest quarter widened to $179.3b, from $161.6b at the end of March this year.

On Monday the NZ Institute of Economic Research (NZIER) consensus forecasts had a downward revision to the national economy's near-term outlook to 2025.

The NZIER forecast expected ongoing challenges next year from suboptimal activity across most sectors and high inflation and interest rates.

The consensus forecast also anticipated ongoing global supply chain disruptions and potential fallout from the Ukraine-Russia conflict slowing global growth.

Foreign investments

Income from New Zealand's investment abroad in the June quarter was $2.4b, largely unchanged from the previous quarter.

Stats NZ said income from direct investment fell $49m.

Income earned by foreign investment in New Zealand was up $266m to $5.2b in the June quarter.