27 Mar 2012

Mixed picture for exports - economist

8:21 am on 27 March 2012

An economist says weaker export incomes look set to provide less support to the recovery of the domestic economy as commodity prices decline.

Official figures show a trade surplus of $161 million in February compared with a small deficit in January.

Exports fell nearly 7% driven by falls in crude oil, aluminium and dairy products, while imports fell nearly 6.5%.

ASB economist Jane Turner, says the decline in export commodity prices and the impact of the higher New Zealand dollar means exports are likely to ease over the coming months.

She says weaker export incomes will provide less support for the domestic recovery. However, she says prices are coming back from very high levels.

Ms Turner says there are nevertheless positive signs in some export commodities.

"We've seen some encouraging signs, we've had a great season for dairy we're looking for meat volumes to start to recover and continued strength in forestry and were also seeing some positive signs in manufactured export volumes - very strong confidence there."