Trade climate shaky but cars abound

By BRIAN FALLOW

New Zealand imported more cars than usual in April but much less oil to run them on, resulting in a pause in the two-year-old deteriorating trend in the trade figures.

In contrast to the previous two months, when a buoyant domestic economy kept imports at similar levels to a year earlier despite a significantly higher exchange rate, imports at $2.5 billion were 10 per cent down on April 2002.

Exports were also lower, by an estimated 9.4 per cent on a year earlier, Statistics New Zealand said. On a trade-weighted basis the New Zealand dollar was 13.8 per cent higher than in April 2002.

The trade balance was $17 million in the black for the month resulting in an annual deficit of $1.89 billion, marginally better than the $1.9 billion recorded for the year to March.

Oil imports were $144 million lower than in April last year, a combination of lower volumes, lower world prices and a higher exchange rate.

Offsetting that, just under 16,000 used cars were imported, worth $115 million, 25 per cent above the 2002 monthly average. Imports of new cars were also strong, 1000 more than the monthly average.

Deutsche Bank economist Darren Gibbs said that was consistent with car registration data and indicated that demand for vehicles remained at all-time highs, in line with record levels of population growth.

But imports of plant and machinery were almost 12 per cent lower in the three months ended April than the previous year.

He said that might reflect deteriorating business confidence, partly due to events in the Middle East, but also to concerns about the appreciating kiwi.