Manufacturing expanding – except in Otago/Southland
Manufacturing in the four major NZ regions expanded in June - except Otago/Southland.
The Otago/Southland region’s manufacturing sector bucked the June trend for expansion across New Zealand’s four major centres, according to a recent survey.
In thelatest BNZ BusinessNZ Performance of Manufacturing Index (PMI) the overall seasonally adjusted PMI for June was 54 A PMI reading above 50.0 indicates that manufacturing is generally expanding.
While this is slightly lower than May’s result of 54.7, combined they are the strongest two months of manufacturing activity since early 2010.
The Northern region led expansion with a PMI of 55.2, with the Central region next at 53.9. While the Canterbury/Westland region dropped 5.6 points from May to 53.9, it still remained in expansion.
In contrast, the Otago/Southland region sunk deeper into contraction during June, recording a PMI of 41.3. The region has had five consecutive months in contraction.
BusinessNZ’s executive director for manufacturing Catherine Beard said that part of the relative positive and steady result for the last two months can be attributed to increased orders and sales from Australia, in part due to the current exchange rate.
“The Australian situation is providing a valuable market opportunity for businesses looking to broaden their sales base.”
BNZ economist Doug Steel said that there seemed to be plenty of reasons for the rate of manufacturing expansion to cool a bit in June, but it didn’t.
“This is fundamentally encouraging. Export growth is holding up despite its many threats, including the strength of the currency, and domestic manufacturing sales look likely to strengthen with the wider economic recovery we foresee."
NBR staff
Thu, 14 Jul 2011
Thu, 14 Jul 2011
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Manufacturing expanding – except in Otago/Southland
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