The last four months of 2009 saw positive movement in New Zealand's manufacturing activity after 16 months of falls.The latest seasonally adjusted BNZ - Business NZ Performance of Manufacturing Index (PMI) gave December a rating of 52.9, up 1.0 point from
The last four months of 2009 saw positive movement in New Zealand’s manufacturing activity after 16 months of falls.
The latest seasonally adjusted BNZ - Business NZ Performance of Manufacturing Index (PMI) gave December a rating of 52.9, up 1.0 point from the previous month.
A PMI reading above 50.0 indicates that manufacturing activity is expanding, a figure that was only breached in October after almost a year and a half sitting below that mark.
Business NZ chief executive Phil O’Reilly warned the level of expansion was still fragile, with future expansion in 2010 partly dependent on the direction of the New Zealand dollar.
“Australia remains an important customer base, and with the lucky country fairing better than most during the recession, increased comments from respondents regarding further demand from our Trans-Tasman neighbours may help pull activity up to levels more consistent with 2006/07.”
Bank of New Zealand senior economist Craig Ebert said the latest result matched the manufacturing section of the latest Quarterly Survey of Business Opinion (QSBO) published last week.
“The relatively positive picture painted by the PMI was also reflected in the QSBO’s results, with several parallels being drawn. These included similar expectations for the next few months in terms of an increased production and new orders, a relatively lean inventory, an abatement of overdue-debtor problems, and generally more positive cash-flow and profitability.”
PMI values for December in the years 2002-2008 ranged from 42.2-58.9, with an average score for the previous December results of 52.6.
The Northern region (52.6) recorded the strongest level of expansion, followed by both the Canterbury/Westland and Otago/Southland regions at 52.2. The Central region (51.7) recorded the smallest gain over the month.
