PMI points to drop in expansion

A gauge of manufacturing still points to expansion in the sector, but at a reduced level to last month.

The monthly ANZ-Business New Zealand performance of manufacturing index (PMI) slipped 0.3 points to 52.7 last month, as manufacturers reported lower production and finished stocks, but an increase in new orders.

Any index level above 50 indicates expansion, but the PMI has fallen from 56.4 at the end of last year.

"Many firms noted that activity had been quiet for the first three months of 2003 but could not provide definite reasons why," ANZ said.

"Some alluded to the conflict in the Middle East disrupting the level of new orders.

"Others commented that the high New Zealand dollar was starting to significantly reduce export orders.

"Some noted that their activity had fallen in tandem with Australia's."