New Zealand's manufacturing activity shrank for a fourth month in September, as new orders fell to the lowest level since May 2009.
The BNZ-BusinessNZ performance of manufacturing index (PMI) rose to 48.2 last month from 47.2 in August, indicating the pace of contraction is slowing. A level of 50 marks the difference between contraction and expansion. Four of the five seasonally adjusted diffusion indexes were in contraction in September.
New orders slipped 2 points to 45.9. Employment edged up 3.7 points to 49.2 alongside production and deliveries though all three remained in contraction. Finished stocks bucked the trend on 50.6, its first expansion since May 2012.
"Talk that the industry is in crisis is overblown," said Craig Ebert, senior economist at BNZ. "Manufacturers' expectations for output over the next three months remain positive."
Tuesday's quarterly New Zealand Institute of Economic Research business survey showed manufacturers held a "fairly solid" view of their business over the next 12 months. Manufacturers' expectations for output over the next three months rose to 17 points from 9 points.
