The impact of slower US growth on local firms will differ from one company to another. Photo / Brett Phibbs
The impact of slower US growth on local firms will differ from one company to another. Photo / Brett Phibbs
Exporters will be watching signs of slowing economic growth in the United States with concern, says an industry group leader.
The US is this country's third biggest trading partner, after Australia and China, and received $3.6 billion worth of locally-made goods last year.
"Exporters are fairly well across the ideathat these are unpredictable times," said ExportNZ executive director Catherine Beard. "On the positive side for exporters is well-flagged continuing growth in Asia."
The US Federal Reserve indicated last week that America's economic recovery had become considerably slower than anticipated.
"In the last few months conditions in the labour market have deteriorated again and the unemployment rate edged up," Federal Reserve Bank of New York president William Dudley said.
"Household spending has flattened out, and the housing sector is depressed."
The US Government is also struggling to find a way to reduce its more than US$14 trillion ($16.8 trillion) sovereign debt, which led to Standard & Poor's decision to downgrade its credit rating, prompting turmoil in global equity markets last week.
NZX-listed companies with a Stateside presence include Nuplex, Fisher & Paykel Appliances, Fisher & Paykel Healthcare, Fletcher Building, Michael Hill International and Pumpkin Patch, although the children's clothing retailer is in the process of closing its remaining stores in that country.
Beard said the impact of slower US growth on local firms would differ from one company to another.
Food exporters tended to be somewhat insulated from the impact of economic decline, she said.
Fisher & Paykel Appliances indicated in May that North American trading conditions remained challenging.
A trading update would be given when the firm holds its annual shareholders meeting in Auckland this month, said company spokesman Matt Orr.
Forsyth Barr analyst Andrew Harvey-Green said conditions in the US had been tough for F&P Appliances for a long time, but the Federal Reserve's indications about slower growth did not necessarily indicate that the situation was going to get any worse.
"I don't think anyone is really forecasting the [Fisher & Paykel Appliances] story in the US to turn around at a great rate of knots," he said.
Fisher & Paykel Healthcare chief executive Mike Daniell said the company was partly protected from the impact of sluggish economic conditions as hospitals tended to keep spending. Of more of a concern was the New Zealand dollar's continuing strength against the US currency, he said.
