Dairy prices drive rise in New Zealand terms of trade

New Zealand's terms of trade rose by 4.9 percent in the quarter to the end of June, due to rising export prices and falling import prices, the government statistics agency announced Monday. It was the second straight quarterly rise in the terms of trade, a measure of the purchasing power of New Zealand exports abroad, but it was still 2.5 percent below the 37-year high reached two years ago, according to Statistics New Zealand. "The terms of trade increase of 4.9 percent reflected higher dairy prices," prices manager Chris Pike said in a statement. "Without dairy, the terms of trade would have risen 1.6 percent. " In the June 2013 quarter, export prices rose 3.4 percent, while import prices fell 1.5 percent, reflecting lower prices for crude oil and capital goods. Dairy exports were the main driver of the rise in terms of trade, with prices up 14 percent and export volumes down 18 percent.