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Net confidence among manufacturers slumped to minus 17 per cent in June from a positive 8 per cent the previous month, says the Canterbury Manufacturers' Association.
The performance index measure of profitability and cash flow slipped slightly to 95.5 - less than 100 indicates contraction.
Chief executive John Walley said there was severe pressure on margins for sales in US dollars.
"Many companies are working harder for longer just to stand still."
