According to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI), New Zealand’s manufacturing sector continued to expand in August, though at a slower rate than the previous month.
The seasonally adjusted PMI for August was 53.1 (where a reading above 50.0 indicates that the manufacturing sector as a whole is expanding, and a reading below 50.0 indicates a contraction). This was down 1.2 points from 54.3 in July, but still above the survey’s long-term average of 52.5.
BusinessNZ’s Director of Advocacy, Catherine Beard said: “It’s pleasing to see manufacturing hold onto expansion, now well over a year running, even as the pace eases back. Employment is the area we’re watching most closely, sitting right on the breakeven mark at 50.0. Respondents continue to point to cost of living pressures and the ongoing conflict in the Middle East as reasons for holding back, but New Orders and Finished Stocks remaining comfortably in expansion suggests there’s still genuine underlying demand.”
Sentiment softened again this month, with 55.7% of comments negative, though a good number of respondents pointed to steady or improving order books as a more positive note.
Employment was the weakest sub-index at 50.0, essentially flat after easing from 52.2 in July, while New Orders (54.9) and Finished Stocks (56.4) held up best. Production (54.2) and Deliveries (52.6) also softened from last month but remained comfortably in expansion.
BNZ Senior Economist, Doug Steel, said “Although weaker than July’s 54.3 print, the 3-month moving average of the PMI continues to rise, indicating the industry is performing well through monthly volatility.”
