BNZ – BusinessNZ
Performance of
Manufacturing
Index

Sticky Gear – PMI

11 Feb, 2022
52.1
January
-1.7

Monthly Change

expanding
slower rate

New Zealand’s manufacturing sector saw a reduction in the level of expansion for the first month of 2022, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI).

The seasonally adjusted PMI for January was 52.1 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining).  This was 1.7 points lower than December, and below the long-term average of 53.1 for the survey.

BusinessNZ’s Director, Advocacy Catherine Beard said that despite the PMI being in expansion since September, it has struggled to gain any real expansionary momentum.  The constantly changing COVID-19 related rules and sanctions are obviously a key inhibiter for certainty and planning, which will likely continue for some time yet given the expected wide spread of Omicron in New Zealand.       

“In terms of the main sub-indices, Production (51.2) and New Orders (53.3) both fell back from healthy levels of expansion in December, while Employment (49.2) fell back into contraction.  These lower activity levels also saw the proportion of negative comments increasing from 49.5% in December to 63.1% in January.”

BNZ Senior Economist, Doug Steel stated that, “January’s PMI results feel like something of a placeholder before Omicron hits proper over coming months along with anticipated higher rates of absenteeism and disruption.”

Catherine Beard

Catherine Beard

Director, Advocacy BusinessNZ

BNZ - BusinessNZ PMI

Time Series Data

View seasonally adjusted and unadjusted time series data for the BNZ - BusinessNZ PMI

Manufacturing Snapshot

PMI

The Performance of Manufacturing Index (PMI) has continued its recent sequence of oscillating around its long-term average. January’s 52.1 reading was a bit under the long-term norm of 53.1, after December’s somewhat perkier 53.8.
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Questions

But the details do raise some questions about what is going on beneath the surface. The production index eased to a slow looking 51.2 in January. Maybe this is just some ‘payback’ from December’s very strong 56.2.
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Is demand slowing?

The PMI new orders index fell to 53.3 from December’s 57.1.  This is not that far below the long-term norm of 55.0, but it is the lowest reading since the lockdown back in August. It makes one wonder if demand has slowed into the New Year.
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What next?

In any case, it has to be said, January’s PMI results feel like something of a place holder before Omicron hits proper over coming months along with anticipated higher rates of absenteeism and disruption.
Read more

Doug Steel

Doug Steel

Senior Economist, BNZ

Sponsor Statement

BNZ is delighted to be associated with the Performance of Manufacturing Index (PMI) and BusinessNZ.

This association brings together the significant experience of leading business advocacy body BusinessNZ, and business finance specialist BNZ.

We look forward to continuing our association with BusinessNZ and associated regional organisations, and to playing our part in the ongoing development of the New Zealand manufacturing sector.

PMI Time Series Table

The results are seasonally adjusted.

National Indicies Jan
2021
Sep
2021
Oct
2021
Nov
2021
Dec
2021
Jan
2022
BNZ – BusinessNZ PMI 57.7 51.7 54.6 51.3 53.8 52.1
Production 60.2 50.3 53.5 53.0 56.2 51.2
Employment 56.4 54.0 51.9 48.6 52.1 49.2
New Orders 61.9 54.5 54.7 55.6 57.1 53.3
Finished Stocks 52.6 50.1 54.8 48.7 53.2 52.8
Deliveries 48.8 47.6 60.2 44.6 51.4 53.8

BNZ – BusinessNZ PMI Time Series

January 2018 – January 2022

International Results

J.P. Morgan Global Manufacturing PMITM

01 Feb 2022
53.2

About the PMI

The BNZ – BusinessNZ Performance of Manufacturing Index is a monthly survey of the manufacturing sector providing an early indicator of activity levels.

A PMI reading above 50 points indicates manufacturing activity is expanding; below 50 indicates it is contracting.

The main PMI and sub-index results are seasonally adjusted.

Technical Contact

Stephen Summers
Economist, BusinessNZ

[email protected]

PMI Releases

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Activity in New Zealand’s manufacturing sector experienced a drop in May and ongoing contraction of the sector, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI). The seasonally adjusted PMI for May was 47.2 (a PMI reading above 50.0...

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Activity in New Zealand’s manufacturing sector experienced a pick up during April, although still remained in contraction, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI). The seasonally adjusted PMI for April was 48.9 (a PMI reading...

One step back

Activity in New Zealand’s manufacturing sector experienced stronger contraction during March, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI). The seasonally adjusted PMI for March was 47.1 (a PMI reading above 50.0 indicates that...

On the improve

Activity in New Zealand’s manufacturing sector continued to show improvement in February, but still remained in contraction, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI). The seasonally adjusted PMI for February was 49.3 (a PMI...

Our Contributors

The BNZ – BusinessNZ PMI contains data obtained through BusinessNZ’s regional organisations