Holding its own – PMI
Manufacturing activity remained in solid territory during November, although the level of expansion eased back from the previous month, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI).
The seasonally adjusted PMI for November was 55.2 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining). This was 3.7 points lower than October, although the PMI has averaged 55.9 so far for 2014.
BusinessNZ’s executive director for manufacturing Catherine Beard said although the level of expansion was not as strong as the previous month, activity was still healthy and positive across all of the sub-indices recorded.
“Comments from respondents remained far more positive than negative, with pre-Christmas activity and obtaining new customers being the most regular comments.”
BNZ senior economist Craig Ebert said, “New Zealand’s Q3 manufacturing sales and inventory data has us judging a nice bounce in the industry’s output, after a bit of a flat patch over Q1/Q2. This profile certainly aligns with the strong pick-up we’ve seen in the monthly PMI since around mid-year.”
Despite the dip in expansion levels, all five seasonally adjusted main diffusion indices were again in expansion during November. Production and deliveries (both 56.6) led the way, with the former slipping 5.3 points from the previous month. New orders (55.1) decreased in expansion levels compared to the previous two post-60 point values for September/October, while employment (54.9) fell back from its record value in October. Finished stocks (51.4) remained relatively unchanged from the previous month.
All four regions were again in expansion during November, which has now been the case for three consecutive months. In the North Island, the Northern region (62.0) continued its upwards momentum to record its highest value since November 2013, while the Centralregion (52.8) experienced a lower level of expansion in comparison to October. In the South Island, the Canterbury/Westland region (63.7) recorded its highest value since May 2013, while the Otago-Southland region (62.7) came back from its strong result for the previous month.
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