New Zealand’s manufacturing sector experienced an increase in expansion during June, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI).
The seasonally adjusted PMI for June was 55.2 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining). This was 3.2 points higher than May, and the highest monthly value since February. The sector has now been in expansion for 33 consecutive months.
BusinessNZ’s executive director for manufacturing Catherine Beard said that the pick up in activity levels for June was positive news after three consecutive monthly dips in expansion.
“The key indicators of production, new orders and employment all showed stronger expansion, while the proportion of negative comments for June (46.4%) was down slightly from the previous month (47.3%). Positive comments in June were varied, with many outlining specific influences to their business. On the flip side, a number of negative comments were centred on the reduced diary payout, which in turn has led to a decrease in rural spending”.
“Overall, the first six months of 2015 have seen more volatility in overall activity compared with recent years, although the index continues to show the sector in growth mode”.
BNZ senior economist Doug Steel said ‘while economic growth might have slowed a bit from last year’s strong pace, these indicators suggest there is still a reasonable rate of expansion occurring despite the clear drag from the dairy sector.’