30 Apr 2014

Imports imply a lift in productivity

7:16 am on 30 April 2014

Solid demand for machinery, plant and transport equipment imports suggests businesses are making investments which bode well for the real economy.

Official figures show the country recorded its highest ever trade surplus for a March month at $920 million, compared with a surplus of $732 million in the same month last year.

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Photo: 123RF

Exports exceeded the $5 billion mark for the first time and last month were valued at $5.1 billion, up by $671 million from March last year.

Milk powder, butter, and cheese exports rose $474 million, or 45 percent, to $1.5 billion, though dairy volumes fell from February.

Exports to two of New Zealand's top three trade destinations, China and the United States, grew, while trans-Tasman sendings fell.

Infometrics economist Benje Patterson says the March figures continue to point towards extroadinary strength in primary goods exports.

Imported goods rose 13 percent, $483 million to $4.2 billion, driven by large items such as ships, boats and a $216 million oil-drilling platform.

Over the three months to March capital goods imports increased a seasonally adjusted 12 percent, or $291 million.

Imports from China and America also rose, while goods coming from Australia fell.

Mr Patterson says import growth has been more modest then export growth, but there are signs imports are picking up.