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Lower exchange rate bolsters growth in New Zealand manufacturing

Xinhua, August 13, 2015 Adjust font size:

New Zealand's manufacturing sector saw its 34th straight month of growth in July, buoyed by the falling value of the New Zealand dollar, according to the latest performance of manufacturing index (PMI) out Thursday.

The BNZ-Business New Zealand PMI for July was 53.5, on a scale where above 50 indicates expansion and below 50 contraction.

The figure was 1.6 points lower than June, but it was still the second highest result for the last four months.

Business New Zealand executive director for manufacturing Catherine Beard said that despite the slower rate of expansion in July, the proportion of positive comments from manufacturers moved up from June.

"The recent fall in the value of the New Zealand dollar came through in many positive comments, while the lower dairy payout continued to trickle through for those who listed a negative influence," Beard said in a statement.

"Although activity in the sector has not been as strong as recent years, the fact that official figures show employment growth primarily coming from the manufacturing sector, as well as ongoing expansion in the PMI, means that the sector continues to hold its own."

BNZ senior economist Doug Steel said it was good to see the PMI maintaining a solid pace through 2015.

"This is supportive of economic growth ahead, although likely at a slower pace than previously achieved as the likes of the obviously intense headwind from the dairy sector filters through," Steel said in the statement. Endi