“Lacklustre” Australian economy dragging down NZ manufacturing result, say Kiwis

Australia’s
economic performance has been cited in explanations of New Zealand’s weakening manufacturing
output.

The Bank of
NZ-BusinessNZ performance of manufacturing index found the overall result down
for the second straight month at 51.8 in April.

Any result
under 50 in the survey-based PMI indicates contraction, so the sector is still
in expansion, as it has been for the last 30 months.

And there wasn’t
a significantly higher amount of negative comments from respondents, said Catherine Beard, executive director of
Manufacturing NZ.

However,
more respondents were mentioning the impact of Australian economic conditions.

“Some outlined the high value of the New Zealand dollar
relative to the Australian, while others mentioned the general lacklustre
Australian economy causing lower demand for New Zealand products,” she said in a statement.

Senior
economist at the Bank of New Zealand, Doug Steel, said that the inclusion of Easter
holidays and Anzac Day may have influenced the April result.

“Respondents also noted the weakness in Australia maybe
affecting their sales, and the cross-rate, with the New Zealand dollar –
Australian dollar being pretty close to parity in the month, would have been a
head wind,” he told Radio NZ.

Image: http://idealog.co.nz/