Economic Week - September 13
by Nick Clark
Meat and dairy drags manufacturing down
Manufacturing sales volumes and values both fell in the June 2019 quarter, according to Statistics NZ’s quarterly Economic Survey of Manufacturing.
Overall, the volume of total manufacturing sales fell 2.7% compared to the March quarter, while the value of total manufacturing sales fell 0.7%.
The meat and dairy manufacturing sector’s sales volumes were down 8.2%, while its sales values were down 2.8%. Sales volumes can be highly volatile for meat and dairy manufacturing due to timing of primary production.
Compared to the same time last year (the June 2018 quarter), total manufacturing sales volumes were down 0.2% but sales values were up 1.3%. For meat and dairy manufacturing, sales volumes were up 0.7% while sales values were up 3.1%.
All the percentage changes are seasonally-adjusted.
Food prices up
Food prices rose 0.7% in August compared to July (and 0.4% when seasonally adjusted), according to Statistics NZ’s Food Price Index.
The fruit and vegetables group led the way, with its prices up 2.9% (vegetables up 6.9% but fruit down 3.0%), although the group’s prices were down 0.4% after seasonal adjustment. Meat, poultry, and fish prices rose 1.0% (beef and veal up 3.2% but mutton, lamb and hogget down 1.1%); while grocery food prices rose 0.4% (bread and cereals down 0.5% but milk, cheese and eggs up 2.5%).
On an annual basis food prices were up 2.1% compared to August 2018. Fruit and vegetables were down 4.6% (vegetables down 8.7% while fruit was up 2.5%); meat, poultry and fish prices were up 8.0% (beef and veal up 7.9% and mutton, lamb and hogget up 10.7%); and grocery food prices were up 2.0% (bread and cereals up 2.3% and milk, cheese and eggs up 4.4%).
Net migration up
Annual net migration has strengthened, according to Statistics NZ’s monthly International Migration Statistics.
For the year ended July 2019 (compared with year ended July 2018) migrant arrivals were provisionally estimated at 149,000 (± 1,500), up 8%, while migrant departures were 96,300 (± 1,300), up 7%. This indicated an annual net migration gain of 52,700 (± 1,600), up from the previous year’s net gain of 48,700 (± 200).
More tourists
Tourism numbers continue to grow but at a moderate rate, according to Statistics NZ’s monthly International Travel Statistics.
There were 255,600 international visitor arrivals in the month of July 2019, up 5,100 compared with July 2018. Visitor arrivals were down from Asia but there were increases in arrivals from Australia and the United States.
For the year to July 2019, there were 3.89 million international visitor arrivals, up 104,400 (or 2.8%) on the year to July 2018.
Next week
Next week sees the release of statistics for June quarter Gross Domestic Product and Balance of Payments. GDP growth is likely to have continued on its slowing trajectory while the BOP deficit is likely to have widened a little.
NIWA Soil Moisture Data
NIWA’s latest soil moisture maps (as at 9am Thursday 12 September) show that soil conditions across country continue to be ‘about average’ for this time of year. The main exception is Maniototo in Otago which is drier than usual and Hawkes Bay and Kaikoura which are wetter than usual.
Exchange Rates
The NZ Dollar was up for the week against the TWI and all of our main trading partners.
NZ Dollar versus
|
This Week
(12/9/19)
|
Last Week (5/9/19)
|
Last Month (12/8/19)
|
Last Year (12/9/18)
|
US Dollar
|
0.6425
|
0.6370
|
0.6469
|
0.6511
|
Australian Dollar
|
0.9350
|
0.9342
|
0.9530
|
0.9175
|
Euro
|
0.5834
|
0.5774
|
0.5772
|
0.5617
|
UK Pound
|
0.5210
|
0.5206
|
0.5375
|
0.5004
|
Japanese Yen
|
69.41
|
67.95
|
68.25
|
72.59
|
Chinese Renminbi
|
4.5606
|
4.5412
|
4.5678
|
4.4790
|
Trade Weighted Index
|
71.52
|
71.09
|
72.03
|
71.24
|
Source: Reserve Bank of NZ