Autumn tinge – PMI

13 Jul 2018

52.8

June

-1.6

Monthly Change

expanding

slower rate

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Catherine Beard

Executive Director, ManufacturingNZ & ExportNZ

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New Zealand's level of manufacturing expansion experienced a dip in June, according to the BNZ - BusinessNZ Performance of Manufacturing Index (PMI).

The seasonally adjusted PMI for June was 52.8 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining).  This was 1.6 points lower than May, and the lowest level of monthly expansion since December 2017, which stood at 51.0.

BusinessNZ's executive director for manufacturing Catherine Beard said that the slow-down in expansion was mainly due to ongoing drops in a key sub-index.

"Production (51.8) experienced another decrease in expansion levels for June, which meant it was down to its lowest point since January 2017.  On a positive note, the other key sub-index of New Orders (57.1) remained in healthy territory, which at least should feed through to production levels in the coming months.    

In addition, the proportion of positive comments in June (51.7%) decreased from May (55.1%), and very similar to February (51.4%).  Those who provided negative comments typically noted a general downturn and uncertainty in the market".   

BNZ Senior Economist, Craig Ebert said that "broadly speaking, the PMI has settled down into a trend-like pace this year, averaging 53.8 (excluding April’s spike). This is after outperformance through most of 2017, when it averaged 56.2".

View the Time Series Data


Main Indicies

Regional Results

Manufacturing Landscape
View Craig Ebert's profile

Craig Ebert

Senior Economist, BNZ

The PMI

New Zealand’s Performance of Manufacturing Index (PMI) slowed further in June. Its seasonally adjusted reading of 52.8 was lower than May’s 54.4 (and with a fair bit of variation in its detail, to boot).
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Orders

The deceleration in the PMI over the last couple of months has been well characterised by its production index. This was raging away at 60.5 in April, but cooled to 53.4 in May and to 51.8 in June.
Read more

Employment

But if there was a red flag in June’s PMI it was in its jobs index. A flat to negative result on this component is not necessarily alarming. But two in a row can start to ask some questions.
Read more

Capacity

Even with the wobbles in the PMI of late, it’s not as if the industry appears any less stretched than it was 6 to 12 months ago. Sure, its capacity utilisation measure (CUBO), as from the QSBO, fell to 92.7% in the June quarter.
Read more

View full BNZ Manufacturing Snapshot

PMI Time Series Table

The results are seasonally adjusted.

National IndiciesJun
2017
Feb
2018
Mar
2018
Apr
2018
May
2018
Jun
2018
BNZ - BusinessNZ PMI 56.053.453.359.154.552.8
Production57.954.052.460.553.451.8
Employment 49.854.653.154.249.649.0
New Orders57.754.554.860.156.757.1
Finished Stocks54.451.354.255.151.650.2
Deliveries56.952.954.660.858.451.3

View the Time Series Data

BNZ - BusinessNZ PMI Time Series

January 2013 – June 2018

PMI Time Series Graph

International Results

J.P. Morgan Global Manufacturing PMITM
2 Jul 2018

53.0

International PMI