New Zealand Trade Balance...

New Zealand trade balance surplus increases more than expected in April

Today, New Zealand economy has confirmed the nation rebounded in April after the natural disaster that hit the nation during the first quarter. However the NZ trade balance surplus expanded more than expectations during the month of April because the widening commodity prices along with the increasing Asian demand for New Zealand products.

The New Zealand economy released today its trade balance reading during the month of April, where the trade balance surplus has followed its widening to NZ$1113 million, from a NZ$464 million surplus in March that revised to NZ$578 million, while the analysts’ expectations referred to NZ%600 million.

Moreover, the nation’s exports accelerated to NZ$4.65 billion in April, compared with a previous NZ$4.53 billion during March, which was revised to NZ$4.53 billion. Further the anticipations estimated of NZ$3.70 billion.

The New Zealand imports slid to NZ$3.54 billion in April from NZ$4.07 billion a month earlier, which revised to NZ$4.04 billion, where the market expectations predicted of NZ$3.70 billion.

The New Zealand exports (which account more than 30% of the economy) surged 17% in April, exceeded analysts’ forecasts, the main engine behind supporting economic growth to put it on the track, and helped the economic recovery to rebound after the Christchurch earthquake that likely subtracted from first quarter growth.

The dairy exports that make up a fifth of overseas sales rose 32% from a year earlier to NZ$1.19 billion. The value was the second-largest on record after March, while milk powder, butter, meat, lumber and wool led the rise as commodity prices increased 1.6 percent in April from March to a record.

On the other hand, the New Zealand economy has noted that the exports to China, the New Zealand’s second-largest market after Australia, accelerated 40%.

At the meantime, Fonterra Cooperative Group Ltd., the world’s largest dairy exporter, announced last this month that milk production was likely to rise 4% in the year ending May 31. Last month, and the export volumes reached a new high in March because of surging demand in China, Southeast Asia and the Middle East.

As for a cheerful today’s report, the New Zealand dollar (the Kiwi) has surged against its all major counterparts, while it recorded new multi-year high against the greenback at 0.8217, as the New Zealand trade balance surplus widened.

Japanese Consumer Price Index (CPI)...

Higher energy and food prices in fuel inflation rates in Japan

The inflation rates in Japan accelerated for the first time in more than two years in April as the energy and food prices increased due to the massive quake that hit Japan in March 11, which caused a damage in the nation's nuclear power. 

Meanwhile, the government noted that the disaster’s effect on the economy has been larger than previously thought, an indication reconstruction plans may exceed the government’s projections, also Japanese government has reduced its economic assessments for the first time in six months after the devastating earthquake that left behind massive destruction and a revolving nuclear crisis. 

Today, the Japanese economy released its consumer price index that inclined 0.3% during the year ended April 30, compared with the previous reading of 0.0% a year earlier, while the actual reading came in line with analysts' expectations. 

Japan's annualized Natl CPI excluding food and energy showed an actual of -0.1% during the 12 months ended April, compared with the previous drop of 0.7% a year earlier, where the actual reading came in line with the market's anticipations. 

Moreover, annual CPI excluding fresh food rose 0.6% in April, from -0.1% last year, whereas the anticipations estimated of 0.6%. 

Crude oil prices jumped 50%, prompting many countries from Thailand to China to raise their interest rates to contain inflation's appreciation, but Japan didn't increase the rates due to the quake's negative results on the economy, while the economy is trying to introduce more stimulus to support the nation to exit from its hurdle phase. 

The signs of a deteriorating economy put renewed pressure on the BOJ to provide additional stimulus after it stepped-up asset purchases and flooded money markets with cash in the wake of the March 11 temblor. The BOJ maintained its view that the economy will rebound later this year as production and supply constraints ease and pledged to take “appropriate” policy action when necessary. 

The Japanese economy has followed expectations when the economy has contracted for a second consecutive quarter after the devastating earthquake and tsunami which contributed to suspend in production process in many Japanese multi-national companies, and prompted consumers to cut their spending. 

Rising costs of daily necessities are spurring concerns that price hikes may further dampen consumption, especially with the temporary shortage of consumer products on the back of the quake that contributed to April’s price hikes. 

Yet, the government last week noted that it aims to allow the Bank to increase legal reserves to maintain financial soundness, while the Bank of Japan reported that it will introduce new appropriate fiscal policies when needed.

Australian Economy in the first quarter.....

Australian economy ignores the sluggish global recovery

The economic growth in Australian continued its forward track to achieve more gains amid the crisis facing the global economy such as the European debt crisis and Japanese quake that had negative results on the global economic recovery.

Today, the Australian economy confirmed that the business investment sector has gained a great performance during the first quarter of the year, which is the third consecutive quarterly increase, affected by the improvements in mining sector.

Australian private capital expenditure index continued increasing during the first three months by 3.4%, compared with the previous incline of 1.3% a quarter earlier, which was revised to 1.5%, while the actual reading came better than analysts' expectations of 2.7%.

The Australian economy has witnessed a resources boom this year, drived up by the BG Group's project that will start work on a $15 billion liquefied natural gas venture in Queensland, generating 5000 jobs, while data in recent days have shown Australian wages grew at the fastest annual pace in almost two years and business investment reached a record.

Australian employers added 37,800 workers in March, more than economists forecast, led by hiring in the mineral- and energy-rich states of Western Australia and Queensland. The country recorded its biggest annual job gain on record last year.

In the wake of the government's efforts to put the economy on the track, the Reserve Bank of Australia (RBA) decided this month to leave interest rates steady for the fourth consecutive month at the highest level of 4.75% to support the economy after the floods and cyclone damage that hit the nation.

Moreover, the government forecasts mining investment to reach A$76 billion next fiscal year, spurring companies to hire workers and prompting the RBA to predict the unemployment rate will fall to 4.25 percent by December 2013. Australia recorded its biggest annual job growth on record last year before hiring cooled down.

On the other hand, the RBA sees the global economy will start its rebounding step from strong growth in the Asian region. The recent disaster in Japan is having a major impact on Japanese production and some effects on production of manufactured products. Commodity prices, including oil prices, have generally continued to rise over recent months, pushing up measures of consumer price inflation in many countries.

Furthermore, Australian trade balance indicator recorded a surplus, exceeding market's expectations because of the demand for Australian iron ore and coal exports accelerated this period. Exports have outpaced higher imports of gasoline.

Yet, the global economy has increased its confidence for the Australian economy, fueling the demand for the Australian dollar versus other major currencies.