Consistent expansion – PMI

19 Jan 2017

54.5

December

0.0

Monthly Change

expanding

same rate

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Catherine Beard

Executive Director,, ExportNZ & ManufacturingNZ

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Activity in New Zealand's manufacturing sector saw December expansion at the same level as November, according to the BNZ - BusinessNZ Performance of Manufacturing Index (PMI).

The seasonally adjusted PMI for December was 54.5 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining). This was the same as November, and the joint lowest expansion level since October 2015. Overall, the sector remains solidly in expansion in almost all months since October 2012.

BusinessNZ's executive director for manufacturing Catherine Beard said that although December's result did not show improvement from November, the overall result for 2016 was encouraging.

"Activity in the manufacturing sector over 2016 averaged out at 56.0. This was up from 54.2 in 2015, but interestingly the same result as both 2014 and 2013. Overall, this shows how consistent and positive activity has been for the sector over the last few years".

"In addition, the proportion of positive comments stood at 70% for December, with seasonal factors (particularly Xmas) having a strong influence".

BNZ Senior Economist, Craig Ebert, said "the December result caps off a positive year for the manufacturing sector.  Indeed, since the survey started in 2002, last year's average has only been surpassed by 2004's 57.5".

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Main Indicies

Regional Results

Manufacturing Landscape
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Craig Ebert

Senior Economist, BNZ

Happy Last Year

New Zealand's Performance of Manufacturing Index (PMI) finished 2016 at 54.5, so no change between November and December. The final two months weren't quite as strong as the rest of the year (not due to earthquakes, it would seem, as, regionally, Central NZ has shown the largest annual increase).
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Some Warnings

The PMI and QSBO both suggest manufacturers enjoyed reasonable growth, particular in production, in the final quarter of 2016. But some details raise a warning.
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Happy New Year

A reason not to be too alarmed by softer new order indicators is manufacturers' overall upbeat outlook. Manufacturers in the QSBO are more confident.
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Supply and Demand

Also above norms are indicators of manufacturers' resource tightness. For example, manufacturers' difficulty in finding appropriate staff has become even more acute while capacity utilisation, at 92.3%, is above its long term average, of 90.4%.
Read more

View full BNZ Manufacturing Snapshot

PMI Time Series Table

The results are seasonally adjusted.

National Indicies Dec
2015
Aug
2016
Sep
2016
Oct
2016
Nov
2016
Dec
2016
BNZ - BusinessNZ PMI 56.955.157.555.154.554.5
Production56.555.961.258.058.057.6
Employment 51.547.250.253.249.151.6
New Orders59.859.060.454.857.852.6
Finished Stocks54.851.454.452.550.051.8
Deliveries57.056.157.455.453.154.6

View the Time Series Data

BNZ - BusinessNZ PMI Time Series

July 2014 – December 2017

PMI Time Series Graph

International Results

J.P. Morgan Global Manufacturing PMITM
3 Jan 2017

52.7

International PMI