Below par – PMI

12 Jul 2019

51.3

June

+0.9

Monthly Change

expanding

faster rate

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Catherine Beard

Executive Director,, ExportNZ & ManufacturingNZ

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Activity in New Zealand's manufacturing sector picked up slightly in June, according to the latest BNZ - BusinessNZ Performance of Manufacturing Index (PMI).

The seasonally adjusted PMI for June was 51.3 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining).  This was 0.9 points up from May, but still the fourth consecutive monthly result below the long-term average of 53.4 for the survey.

BusinessNZ's executive director for manufacturing Catherine Beard said that while the sector avoided further deterioration in activity from May, there were still a number of concerns about manufacturing's current state of play.

"The key sub-indexes of production (51.0) and new orders (52.8) recovered from May, which ensured the sector didn't fall into contraction for June.  However,  employment (48.0) worsened to its lowest level since August 2016, while deliveries of raw materials (48.9) also fell into negative territory for the first time since December 2017, and its lowest result since September 2012.

The proportion of positive comments for June (42.9%) feel back markedly from May (54.3%).  Soft and slow market activity tended to dominate negative comments, along with a fair degree of uncertainty present.

BNZ Senior Economist, Craig Ebert said that “the latest PMI might best be described as doing doggy paddle, with both ups and downs around some of the main PMI sub-index values”.

View the Time Series Data


Main Indicies

Regional Results

Manufacturing Landscape
View Craig Ebert's profile

Craig Ebert

Senior Economist, BNZ

The PMI

With its nostrils just above the water line, the latest Performance of Manufacturing Index (PMI) might best be described as doing doggy paddle.
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QSBO

To be more charitable about June’s PMI would be to distinguish it from the manufacturing section of the latest NZIER Quarterly Survey of Business Opinion (QSBO). This was, to put it mildly, struggling.
Read more

Employment

Arguably the most worrying statistic in the QSBO’s manufacturing element, however, was to do with recent employment. This index, regarding the last 3 months’ hiring, plunged to -36, from about zero the preceding quarter. This was spookily GFC-like.
Read more

Capacity/Pricing

To help understand the stuttering in many of the manufacturing activity indices, it’s hard to go past the range of resource-constraint gauges. Take the QSBO’s capacity utilisation variable, CUBO.
Read more

View full BNZ Manufacturing Snapshot

PMI Time Series Table

The results are seasonally adjusted.

National IndiciesJun
2018
Feb
2019
Mar
2019
Apr
2019
May
2019
Jun
2019
BNZ - BusinessNZ PMI 52.753.451.752.850.451.3
Production51.353.450.650.446.851.0
Employment 49.650.751.851.448.548.0
New Orders56.252.152.752.550.752.8
Finished Stocks50.054.453.252.356.857.6
Deliveries52.754.052.354.251.248.9

View the Time Series Data

BNZ - BusinessNZ PMI Time Series

July 2014 – June 2019

PMI Time Series Graph

International Results

J.P. Morgan Global Manufacturing PMITM
1 Jul 2019

49.4

International PMI