Soft dollar cushions low commodity prices

A weaker dollar more than compensated for a further decline in world prices for the main export commodities last month.

ANZ's world commodity index fell 1.4 per cent, the 10th consecutive monthly fall, led by falling prices for lamb and beef. But when converted to New Zealand dollars, the index rose 4.5 per cent, to be 6.7 per cent higher than a year ago.

ANZ said the rise in the local currency index would be welcomed by the agricultural community.

Lamb prices fell 5.2 per cent last month, the ninth monthly decline, to be 18 per cent down on a year ago.

Beef prices dropped 2.1 per cent, reversing gains in January and February, to be 4.9 per cent down on a year ago.

Aluminium prices fell 1.3 per cent after five months of strong gains while wood pulp prices continued their recovery from a trough last December, rising 1.9 per cent from February.