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Plunging Australian demand hitting New Zealand exports: business survey

Xinhua, April 2, 2015 Adjust font size:

Weakening demand from Australia is helping to drive down New Zealand exports, the New Zealand Manufacturers and Exporters Association (NZMEA) said Thursday.

A survey of business conditions showed total sales in February fell by 18.2 percent year on year, with export sales down by 27.06 percent and domestic sales up 10.08 percent.

Domestic sales improved year on year for the third month in a row, but export sales had reverted to negative after January saw improved sales.

"Being one of our largest markets, weak demand and returns from Australia is becoming an increasing issue for manufacturers, along with the weak Australian dollar, hitting many who sell products in this currency," NZMEA president Tom Thomson said in a statement.

"For many it is like the tap has been turned off, and for most, prices cannot be raised to off-set. Similar conditions continue to be felt for exporters to Europe and high volatility of the currency remains a challenge for almost all exporters."

The New Zealand dollar reached record highs against the Australian dollar last month, and the Reserve Bank of New Zealand has repeatedly warned that the overvalued currency is "unjustified and unsustainable." Endi