NZ manufacturing continues to grow

New Zealand’s manufacturing sector continued to grow significantly in December, according to a key index.

The seasonally adjusted BNZ-Business NZ performance of manufacturing index (PMI) for December was 57.7. This was 2.1 points up on the November figure of 55.2.

Figures above 50 indicate expansion in the sector, while figures under 50 indicate contraction.

BusinessNZ's executive director for manufacturing Catherine Beard said in a statement that 2014 represented another good year for New Zealand's manufacturing sector.

"Over 2014, the PMI averaged 56.0, which was exactly the same as the average value for 2013. At the very least, the sector has remained in a position of healthy growth, with comments from respondents typically focused on ongoing and steady demand, both within New Zealand and offshore," she said.

Four out of five seasonally adjusted main diffusion indices also expanded during December.

New orders topped the list at 62.0, while the figure for production was 61.7. Deliveries rose to 58.7, while finished stocks (50.4) dropped to its lowest value since August.

The only index to fall was Employment which fell to 49.4, which was the first drop for 14 months.

Three of the four regions were in expansion during December, with mixed results across the country. In the North Island, the Northern region (56.9) fell back from 62.0 in November, while the Centralregion (49.3) experienced contraction for the first time since August.

In the South Island, the Canterbury/Westland region (60.0) experienced its third consecutive 60+ point value, while the Otago-Southland region (66.0) built on its November result.

BNZ senior economist Doug Steel said, "The PMI results for manufacturing are consistent with broader indicators showing that the economy is in good heart. There is a lot to like with activity expanding at a solid clip with no inflation."