Strong dollars supports rise in New Zealand terms of trade

New Zealand's terms of trade held near a 40-year high during the quarter to the end of June, with the strong dollar holding down import price and offsetting a drop in exports, the government statistics agency announced Monday.

The terms of trade, the measure of the quantity of imported goods that can be bought for a set amount of exports, rose 0.3 percent in the June quarter due to export prices falling less than import prices, according to Statistics New Zealand.

"This is the lowest of six consecutive quarterly rises for the terms of trade, which is now 1.3 percent below its all-time high in the June 1973 quarter," international statistics manager Jason Attewell said in a statement.

A strengthening New Zealand dollar held down import and export prices, he said.

The price of exported goods fell 2 percent, with dairy prices falling 4.3 percent and forestry product prices falling 6.5 percent.

Prices for imported goods fell 2.3 percent with falls across most sectors, but led by a 3.9-percent drop in petroleum and petroleum products due to lower prices for crude oil.

In the June quarter, export volumes fell 5.3 percent, while import volumes rose 3.6 percent.

"Export volumes recorded their largest fall since the March 2008 quarter. This was due to falls from high levels in key primary products," said Attewell.

Meat export volumes fell 8.3 percent, forestry volumes fell 8.3 percent and dairy volumes fell 2 percent.

Import volumes rose 3.6 percent, continuing a series of rises that began at the start of 2013, led by capital goods.

The trend for import volumes had risen for seven consecutive quarters by a total of 19 percent.