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New Zealand's golden trade run has come to a sudden halt, with the July trade data released yesterday showing the first deficit since last October.
The deficit follows a string of eight consecutive surpluses.
Separately, the New Zealand Institute of Economic Research warned yesterday the economic recovery was off its peak.
Labour Party leader David Cunliffe said it had been clear National's over-reliance on dairy and disaster was not a real recovery and this was hurting other sectors and limiting export growth.
Westpac senior economist Michael Gordon said the July merchandise trade deficit was larger than he or the market expected due to a larger than expected drop in export receipts.
''We suspect the surprise is largely due to normal monthly volatility in export volumes given the fall in world prices for dairy and logs was already known.''
In seasonally-adjusted terms, exports fell 7.5% by value in July.
Dairy exports were down for a second consecutive month, reflecting a 4.7% drop in prices and a 4% fall in volumes.
There was also a fall in volumes of meat, fruit, seafood and crude oil.
Mr Gordon said exports could be choppy from month to month, especially for oil, due to the timing of shipments.
Statistics New Zealand figures showed the July trade balance was a deficit of $692 million compared with a market forecast of a $475 million deficit.
Exports were $3.7 billion for the month, compared with forecasts of nearly $4 billion. Imports were $4.4 billion, in line with forecasts.
The annual balance was still in surplus at $1.3 billion.
ASB chief economist Nick Tuffley said it was worth noting July represented the high mark for the New Zealand dollar.
The trade-weighted index, a basket of currencies from New Zealand's main trading partners, hit fresh post-float highs, touching 82.01 on July 14.
At the same time, the New Zealand dollar came close to the US88.34 record high set back in 2011.
ASB had expected to see the first of Air New Zealand's new Boeing 787 Dreamliners - worth up to $200 million - included in the July trade data.
However, Statistics NZ excluded the item from the data to keep the purchase price confidential, he said.
''Incidentally, it has been widely reported Air NZ has received a large discount on the ticket price, as Boeing delayed delivery several times due to technical issues,'' Mr Tuffley said.
NZIER chief economist Shamubeel Eaqub said the New Zealand economy grew strongly through the first half of the year but the pace was slowing.
Economic growth would ease from 3.5% in 2014 to a still respectable 2.7% next year.
Rising interest rates were biting, as seen in falling house sales and waning confidence. More uncertain global demand cast a shadow over the outlook.
''While some parts of the economy are easing, there is also an underlying and gradual recovery under way.
"Spending and investment behaviour is gradually returning to normal but it has not been accompanied by households and businesses gorging on debt as seen in previous cycles.
"This makes this recovery more sustainable.''
However, the good news was tinged with caution, Mr Eaqub said.
Hiring was improving but the spoils were unevenly shared across regions and industries.
Auckland had gained nearly 70% of the new jobs since the pre-recession highs.
Canterbury gained 20% and the remaining 10% was spread thinly across the rest of New Zealand.
Professional services and health sector employment have surged but gains are more gradual in other industries.
The manufacturing sector continued to shed jobs.
''The rather lumpy and wobbly recovery, both in terms of speed and composition, means this recovery is still elusive to many industries and regions.
"This in part explains why inflation is still subdued and is likely to remain so for some time,'' Mr Eaqub said.