The shortfall shrank to NZ$4.11 billion ($2.5 billion) in the 12 months ended April 30 from NZ$4.68 billion in the year through March, the statistics bureau said in Wellington today. That’s less than the NZ$4.15 billion median estimate in a Bloomberg News survey of seven economists.
Demand for imports has tumbled as companies cut investment while the highest unemployment in six years prompts the nation’s consumers to restrain spending on televisions, cars and holidays. As well as a slowdown in the domestic economy, New Zealand is grappling with a drop in export earnings as the global recession reduces sales of commodities such as milk products and aluminum.
Still, she added that declines in imports will reduce the nation’s current-account deficit, which could help New Zealand stave off a S&P ratings downgrade.”
Standard & Poor’s said in January New Zealand’s AA+ foreign-currency credit ranking may be cut if expanding current- account shortfalls and overseas debt curb investment and growth.
Confidence among New Zealand companies slumped to the lowest since 1974 in the first three months of this year, according to a business poll published on April 7.
The economy began contracting in the first quarter of last year and will probably remain in recession until at least June 30, Finance Minister Bill English has said.
Imports tumbled 18 percent in April from a year earlier to NZ$3.37 billion, today’s report showed. The NZ$745 million decline was the most since records began in 1962.
There were large one-time machinery imports in April last year that exaggerated the decrease, the agency said. Capital- goods imports more than halved to NZ$485 million from NZ$1.01 billion a year earlier.
Excluding machinery, the drop in imports was led by cars and other transport equipment.
Exports fell 4.6 percent from a year earlier to NZ$3.65 billion, led by a decline in crude oil and aluminum shipments. Commodity prices tumbled 30 percent in April from a year earlier, according to an index compiled by ANZ National Bank.
Sales of milk powder, butter and cheese, which make up almost one-fifth of total exports, dropped 5.4 percent, today’s report showed.