The BNZ-Business NZ Performance of Manufacturing Index (PMI) rose in June from May to deliver the second highest June result since the survey began in August 2002.
At 56.2, June’s seasonally adjusted PMI was up from 54.4 in May, recording the tenth straight month of expansion for the sector. Any reading over 50 denotes an expansion. Since the survey began, the only June to record a higher reading was June 2004’s 62.8.
BNZ and Business NZ said all five of the seasonally adjusted indicies covered by the survey – employment, production, new orders, finished stocks and deliveries - expanded last month. The strongest improvement was in employment, which at 52.4, improved from a 49.3, a contraction, in May to record its highest result since November 2007.
“Significantly, from an output perspective, the three month average of the PMI has settled at a healthy position of over 56, well above the break-even 50 mark. This strongly suggests another positive quarter of manufacturing growth occurred in the second quarter,’ BNZ and Business NZ said.
“This is important as the rebound in manufacturing production, foretold by the PMI, has been a major thrust behind the economic recovery to date. The manufacturing sector grew 1.6% in the first quarter, providing the strongest positive contribution to nationwide Gross Domestic Product growth for the second consecutive quarter. Manufacturing activity is up 4.3% on year ago levels – displaying more than twice the pace of growth in the economy overall.”