Source: Radio New Zealand
The manufacturing sector expanded in April, but only just. UnSplash/ Silvia Brazzoduro
- Manufacturing activity eased to 50.5 from 52.8 in March – above 50 is expansion.
- Two of the five sub indexes are in contraction – new orders and deliveries of raw materials.
- Employment was strongest sub index at 53.4.
The manufacturing sector expanded in April but only just, as the impact of the fuel crisis started to bite.
That and the war in Iran appear to be dampening activity in the manufacturing sector.
The sector did expand in April according to the latest BNZ-BusinessNZ Performance of Manufacturing Index (PMI). However the growth was marginal, with the PMI for April coming in at just 50.5. A reading above 50 indicates the sector is growing.
The April result was down from 52.8 in March and 54.6 in February.
The long-term average for the index is 52.5.
“The Performance of Manufacturing Index had been remarkably robust with the headline reading for March down on previous months but still solidly above the break-even line,” BNZ head of research Stephen Toplis said.
“However, we feared it was only a matter of time before the wheels started to fall off and, alas, the April survey indicates that time may now have arrived.”
The war in Iran and the impact on fuel prices was of increasing concern for firms in April, according to BusinessNZ director of advocacy Catherine Beard.
“The proportion of respondents highlighting negative influences on their business performance was 63.6 percent, compared to 62 percent in March. And many of the comments focused on the effect of the war against Iran on freight and fuel costs, as well as its impact on deliveries of raw materials.”
Two of the five sub-indexs were in contraction, with new orders 48.2 and deliveries of raw materials at 46.5.
Employment was the strongest sub index at 53.4.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand