New Zealand’s manufacturing sector experienced a further increase in expansion, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI).
The seasonally adjusted PMI for February was 52.0 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining). This was 0.8 points up from January, although still below the long-term average activity rate of 53.0.
BusinessNZ’s Director, Advocacy Catherine Beard said that the February result managed to show an incremental step towards higher levels of activity, which at the very least starts the year off with two months of consecutive expansion.
“The key sub-index of New Orders (52.0) returned to expansion after five consecutive months of contraction, while Finished Stocks (55.8) and Employment (54.0) both experienced ongoing growth. However, Production (49.4) did fall back into contraction to its lowest level since June 2022, while Deliveries (51.8) showed the same level of expansion as the previous month.
With a further lift in activity for February, the proportion of negative comments from manufacturers dipped to 60.2%, compared with 69.9% for January, 63.5% for December and 58.4% for November. Manufacturers were somewhat split with some noticing a slowdown in sales and enquiries, while others noted a bump in activity, including new customers both domestically and offshore.
BNZ Senior Economist, Craig Ebert stated that “it’s been a New Year gearshift, out of reverse. However, these are not what you’d call strong results – in total, and especially when delving into the details. That said, February’s PMI, like January’s, did denote expansion, overall, and is not all that far shy of its long-term average of 53.0″.