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Catherine BeardExecutive DirectorManufacturingNZ
12 May 2017
“The April value for new orders (62.4) was only slightly down from the March value, with the combined result of the two months the highest for new order expansion since 2004. While production (56.9) dipped in terms of expansion, the remaining indices remained either stable or increased slightly from March”.
“Mirroring the overall result, the proportion of positive comments also dipped somewhat from 67.2% in March to 64.7% in April.
BNZ Senior Economist, Craig Ebert, said “there weren’t any significant jags in the main component detail of the PMI for April, leaving them all looking good. Overall, April’s PMI was another deserving of a big tick”.
While New Zealand’s manufacturing sector saw expansion in activity soften slightly in April, the sector remains in healthy territory, according to the BNZ - BusinessNZ Performance of Manufacturing Index (PMI). The seasonally adjusted PMI for April was 56.8 (a PMI reading above 50.0 indi-cates that manufacturing is generally expanding; below 50.0 that it is declining). This was 1.2 points lower than March, but still the second highest value since September 2016. Overall, the sector has remained in expansion in all months since October 2012.
BusinessNZ’s executive director for manufacturing Catherine Beard said that the fundamentals of expansion in the sector remain on track.
In gear
View PMI Time Series Data
BNZ - BUSINESSNZPERFORMANCE OFMANUFACTURINGINDEX
56.8 -1.2 expandingApril Value Monthly Change Slower rate
Construction To be sure, the indicators around construction remain generally upbeat. However, the technical picture around its activity for the March quarter has a few clouds about it.
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Title The Reserve Bank was right yesterday, in stating that “Global economic growth has increased and become more broad-based over recent months.” The JP Morgan IHS Markit Global Manufacturing PMI supported this.
Read more →
The PMI New Zealand’s Performance of Manufacturing Index (PMI) remained strong in April. It chimed in with a seasonally adjusted 56.8, from 58.0 in March – making the low point back in January, of 53.2, seem but a distant concern.
Read more →
Employment The other component detail that was encouraging was regards staffing. April’s PMI index on employment was 53.0. This was about as robust as it was in March (53.5) and so still securely above its long-term average, of 50.5.
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Manufacturing Snapshot
Craig EbertSenior Economist
View full BNZ Manufacturing Snapshot
Main Indices Regional Results
Production
Employment53.0
Deliveries54.6
New Orders62.4Finished Stocks
53.8
55.7
52.0
52.8
49.7
56.9
January 2012 - April 2017
BNZ - BusinessNZ PMI Time Series
National Indices Apr2016
Dec2016
Jan2017
Feb2017
Mar2017
Apr2017
BNZ - BusinessNZ PMI
Production
Employment
New Orders
Finished Stocks
Deliveries
Results are seasonally adjusted
PMI Time Series Table
View PMI Time Series Data
54.654.054.353.354.657.1
53.852.855.651.052.152.7
62.463.259.053.852.960.8
53.053.551.552.151.750.6
56.960.057.749.157.658.8
56.858.055.753.254.556.7
Level 6, JacksonStone House, 3-11 Hunter Street, Wellington 6140+64 4 496 6444 | info@businessnz.org.nz
ssummers@businessnz.org.nz
Stephen Summers:
Technical Comment
04 474 6799
Craig Ebert:
04 496 6560
Catherine Beard:
For media comment, contact:
Media CommentSponsor StatementBNZ is delighted to be associated with the Performance of Manufacturing Index (PMI) and BusinessNZ.
The association brings togetherthe significant experience of leading business advocacy bodyBusinessNZ, and business financespecialist BNZ.
We look forward to continuing ourassociation with BusinessNZ and associated regional organisations, and to playing our part in theongoing development of the NewZealand manufacturing sector.
52.82 May 2017
J.P. Morgan Global Manufacturing PMITM
International Results
USA
Australia
Eurozone
UK
China
Japan
NZ56.8
52.854.2
51.2
59.2
56.8
52.8
The PMI
New Zealand’s Performance of Manufacturing Index (PMI)
remained strong in April. It chimed in with a seasonally
adjusted 56.8, from 58.0 in March – making the low point
back in January, of 53.2, seem but a distant concern. Nor
were there any significant jags in the main component
detail, so leaving them all looking good as well. In
particular, new orders were still leading from the front,
with an index reading of 62.4, while production itself was
reasonably expansive, at 56.9. The positivity was less
uniform on the basis of industry type, and by way of
regional breakdown. However, overall, April’s PMI was
another deserving of a big tick.
Employment
The other component detail that was encouraging was
regards staffing. April’s PMI index on employment was
53.0. This was about as robust as it was in March (53.5)
and so still securely above its long-term average, of 50.5.
This, in turn, suggests that the recent improvement we
saw in the Household Labour Force Survey measure of
manufacturing employment will be sustained. In the
March quarter of 2017 it was up 6.0% on the same
quarter a year ago. This is after a soft patch through last
calendar year, during which it fell 5.5%. Over this period
the PMI employment index turned contractionary (less
than 50) in four out of the twelve months.
Construction
To be sure, the indicators around construction remain
generally upbeat. However, the technical picture around
its activity for the March quarter has a few clouds about it.
In particular, the slump that we witnessed in building
consents late last year (albeit from very strong levels)
points to a significant decline in building activity in Q1. If
so, it would dent GDP growth expectations, perhaps by
way of some manufacturing activity too. A test will come
in the Q1 Building Work Put in Place report. This is due 6
June and maps construction GDP very well. Ahead of this,
there are the Q1 ready-mixed concrete statistics to check
out. These are scheduled for release 17 May.
Global
The Reserve Bank was right yesterday, in stating that
“Global economic growth has increased and become
more broad-based over recent months.” The JP Morgan
IHS Markit Global Manufacturing PMI supported this. It
maintained a decent pulse in April, with 52.8, having gone
close to flat over the first half of last year. This report went
to on say that “Price pressures stayed elevated in April.
Although rates of increase in average input costs and
output charges both eased further from recent highs, they
remained above the respective long-run averages.” As for
the RBNZ outlook for global inflation it described this as
broadly subdued.
Maintained Momentum
A Jobs Rebound
Flying Through a Q1 Air Pocket?
A Truly Global Movement
craig_ebert@bnz.co.nz
BNZ Research
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