New Zealand’s Terms of Trade fell significantly, with the actual result of -2.1% showing a sharp decline from the previous quarter’s 4.1%. This represents a substantial drop of 6.2 percentage points, indicating a reversal in trade conditions.
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The actual result was far below the analyst estimate of 0.3%, suggesting unexpected challenges in the trade environment. This negative surprise is likely to weigh on export-oriented sectors, as the terms of trade deterioration may signal reduced profitability. The market impact could be both immediate, affecting sentiment, and longer-term, influencing trade policy expectations.