RTTNews - Manufacturing activity in New Zealand continued to climb out of the depths of contraction in June, reflecting the highest overall activity level in nine months, the latest Performance of Manufacturing Index report by the Business New Zealand said Thursday.
The seasonally adjusted index stood at 46.2 in June, climbing 3.1 points from May. This is the also highest reading since September 2008, when the index stood at 46.5. A reading above 50 indicates that manufacturing is generally expanding, while a reading below 50 indicates it is contracting.
New orders, which provides a future indicator of production, was positive for the first time since April 2008, while production was also at its highest level for nearly a year, the BNZ said. Further, the month-on-month increase in new orders was the largest in the history of the survey. However, the finished stocks index dropped another 1.3 points from May to reach a second consecutive new low from the time the series first began.
Commenting on the latest performance of manufacturing data, Craig Ebert, Senior Economist with the BNZ said, There are increasing signs the sector is beginning to see some light at the end of the tunnel. Of course, it's still a long, dark tunnel. But the big jump in the new orders index gives hope of some locomotion in activity before too much longer.
During the month, four of the five sub indicators continued to contract, with three of the five showing a worse level of contraction than in May, the report said.
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