Quarter ending with a whimper

<p>Kia ora,</p><p>Welcome to Wednesday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.</p><p>I'm David Chaston and this is the international edition from Interest.co.nz.</p><p>And today we lead with news that the run to the end of the quarter is proving to be a subdued affair.</p><p>First up today, the American retail impulse is not in great shape. Compared with a year ago, <a href="https://www.redbookresearch.com/" target="_blank"><strong>retail sales</strong></a> were up only +2.8% last week on a same-store basis. This isn't anywhere near strong enough to cover inflation, so retail sales volumes are shrinking - and probably have done for the past month.</p><p>However, on an actual basis, the American <a href="https://www.census.gov/econ/indicators/advance_report.pdf" target="_blank"><strong>merchandise trade deficit shrank</strong></a> in February, coming in at -US$71.5 bln for the month and down from the year-ago level of -US$84 bln. That is because their exports rose +5.4% year-on-year and imports fell -1.9% on the same basis.</p><p>The <a href="https://www.richmondfed.org/-/media/RichmondFedOrg/research/regional_economy/surveys_of_business_conditions/manufacturing/2023/pdf/mfg_03_28_23.pdf" target="_blank"><strong>Richmond Fed's factory survey</strong></a> in the mid-Atlantic states recorded improvements in March in both employment and new orders, and an overall modest improvement in business conditions. Although still elevated, the costs component fell sharply in March. Overall, this is an interesting contrast to the weak Texas survey we noted yesterday.</p><p>The latest survey of American consumer confidence is the widely-watched one from the <a href="https://www.conference-board.org/topics/consumer-confidence" target="_blank"><strong>Conference Board</strong></a>, and that shows a modest rise in March. But there is no sign in here that inflationary expectations are receding.</p><p>In China, a high-ranking trade official has been <a href="https://www.caixing