25 Sep 2009

Trade deficit narrows as imports fall

12:17 pm on 25 September 2009

The annual trade deficit fell to the lowest level in seven years in August as the recession dampened imports.

The shortfall narrowed to $2.4 billion in the year to August, Statistics New Zealand says. For the month, the deficit stood at $725 million.

Exports fell 23% to $2.7 billion from a year ago, with dairy products, meat and crude oil leading the declines.

Imports fell almost 22% to $3.5 billion, led by lower crude oil prices and fewer vehicles.

Senior economist at UBS, Robin Clements, says as the economy gradually picks up, imports will rise and it's likely the trade deficit will again start widening, he says.