The current account deficit widened to $4.6 billion in the June quarter, taking economists by surprise.
The larger-than-expected deficit has been due to a weak economy, and the imbalance of paying out more income to foreign companies than the country gained from overseas investments.
The deficit, at 8.3% of GDP, is one of the highest of any country in the developed world and could lead to overseas investors charging higher interest rates to borrowers in New Zealand.
However, the Reserve Bank says the New Zealand financial system is stable despite the balance of payments deficit ballooning out to record levels.
ASB chief economist Nick Tuffley says factors such as high oil prices and the effects of this year's drought may maintain current deficit levels for some time, but they should start to narrow next year.
Income earned by foreign investors in New Zealand increased $214 million over the quarter, while New Zealand's earnings from investments abroad fell $18 million.
For the June year, the current account deficit stood at $14.9 billion dollars, or 8.3% of GDP.
