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In the fourth quarter, New Zealand's terms of trade declined as weaker prices for dairy and meat saw export prices falling more than import prices. The merchandise goods terms of trade fell 2% in the fourth quarter, export prices fell 5.7%, and import prices dropped 3.7%. Terms of trade measure the buying power of New Zealand's exports abroad. In the fourth quarter dairy export prices fell 13% while volumes fell 0.9% and the value of exports fell 6.7% to $2.9 billion. The average price for while miles power has dropped 18% at the four fortnight Global Dairy Trade actions this year to US$1890 as global milk supply continues to outweigh demand and weaker dairy has hit the broader economy.

The country's purchasing power with the rest of the world has fallen for the second quarter in a row. The fall in price of exports is greater than the fall in price on imports