Manufacturing continues lackluster performance
11 November 2005
Manufacturing activity continues lackluster performance
Manufacturing activity continued to be lacklustre in October, according to the Business NZ Performance of Manufacturing Index (PMI).
The PMI for October showed a value of 49.6, down from 52.3 in September, and recording a slight decline. Scores above 50 indicate that activity is expanding; below 50 indicate a decline.
The October 2005 result was again considerably lower than the previous three October results, ranging from 56.7 to 64.6 between 2002 and 2004.
The level of activity by region was higher in the South Island than the North Island. The Otago/Southland region (54.9) recorded the highest level of expansion for the third consecutive month, and was the only region not to experience its lowest ever value for an October month. The Canterbury/Westland region (52.7) recorded expansion for the first time since July. Both the Northern (48.4) and Central (48.8) regions recorded similar levels of decline for October.
Finished stocks (51.5) led the sub-indexes in October, which is the third time this has occurred during 2005. New orders (50.5) showed slight expansion, while the remaining sub-indexes ranged in value from 47.6 to 49.8.
The October result continues the 2005 trend of softening in the manufacturing sector compared with previous years. Comments from manufacturers show uncertainty during the post-election period is still affecting activity. Exchange rate issues still persist, while high fuel prices are also causing increases in costs.