A surge in new orders and dwindling stocks is drove an expansion in New Zealand's manufacturing sector in April, but jobs were still shrinking, according to the latest performance of manufacturing index (PMI).

The BNZ-Business New Zealand PMI for April was 54.5, on a scale on which above 50 indicates expansion and below 50 contraction.

The figure continued a healthy and consistent run for the year so far with an average of 54.8 over the four months, and it was 7. 4 points higher than April last year.

Business New Zealand executive director for manufacturing Catherine Beard said the last four months had shown a regular pattern of growth, helped by strong activity for new orders, both domestic and offshore.

"Another aspect that needs to be examined is the increasing disparity of activity between New Zealand and the Australian manufacturing sector," Beard said in a statement.

"In comparison, the Australian PMI for April was 36.7, their lowest result since May 2009. In fact the 2013 year provides the two largest monthly differences in activity levels between the two countries since the New Zealand PMI began in 2002."

BNZ senior economist Craig Ebert said the biggest positive came from the fact that new orders, way up at 59.4, met with falling stocks at 47.8.

"This strongly suggests production will not only keep ramping up, but needs to in order to avoid emptying the shelves," Ebert said in the statement.

Only three of the five main sub-indices were in expansion for April, with new orders at 59.4, its highest result since February 2012, followed by deliveries at 55.7, production at 55.3, while both employment (48) and finished stocks (47.8) were in decline. Endit

Go to Forum >>0 Comment(s)