By Hannah Lynch
New Zealand’s manufacturing sector contracted for a second month in November, with activity at the lowest level since June 2009 reflecting a decline in production and new orders.
The Bank of New Zealand Performance Manufacturing Index for November fell to 45.7 from 46.6 in October, the third time a decline has been measured for the month. A reading below 50 indicates contraction.
The sector traditionally picks up in the lead up to Christmas, however a slow-down during the Rugby World Cup and reservations about the global financial outlook have contributed to its decline.
“The November PMI is worrisome, reflecting a combination of softening global demand for metal mental and an extremely weak domestic construction sector,” said Craig Ebert, senior economist at Bank of New Zealand. “However, this is miles away from the GFC meltdown in 2008/09 and we remain hopeful that a pick-up in building activity and solid primary goods exports will support the sector through the 2010 calendar.”
Of the five diffusion indices in the PMI, production slipped the most to 43.6, followed by new orders on 45.8 and deliveries at 47.5. Employment improved one point from October to 49.6 while stocks expanded, on 51.2.
The PMI comes ahead of gross domestic figures for the third quarter, due out next week. A Reuters poll of eight economists’ forecasts says Gross Domestic Product will rise 0.8 percent in the third quarter from 0.1 percent three months earlier.
(BusinessDesk)
Performance of manufacturing index
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5 Comments
softening global demand for mental? solid primary goods exports will support the sector through the 2010 calendar ?
Long story short, even though production is decreasing, stockpiles are increasing. Global demand for metal may be softening, I know a couple of soft metals that the Chinese have been buying in ever increasing amounts.
Hell yes we do gonz....................we can make a really cracking economic mess of things...have done for years...and we can make banks ever so profitable...and MPs salaries ever so fat...and senior state bureaucrats so happy when they collect their half million dollars a year wages...we make lotsa stuff gonz.
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