KEY POINTS:
The manufacturing sector continues to expand although optimism is falling in the face of the high dollar, the latest Business NZ survey says.
The seasonally adjusted Performance of Manufacturing Index for February was 53.9, with results above 50 indicating expansion. All five main indices expanded for the fifth month in a row - production 53, employment 53.2, new orders 56.8, finished stocks 51.1 and deliveries on 54.
However, Business NZ chief executive Phil O'Reilly said the downside was increased comment about the high dollar.
"So objectively [we are] still chugging along at a reasonable rate but perhaps not for much longer if those comments start to play out," O'Reilly said.
February's performance was similar to the mid-50 mark, but was down 1.9 points on January.
The share of positive comments fell from 45.5 per cent to 38 per cent with a lack of labour re-emerging as a main barrier to expansion.
"The longer the dollar stays high and stays volatile the harder it's getting for them," O'Reilly said.
"If the Reserve Bank lifts interest rates again in the near future you'll see continued pressure on the dollar."
