HomeLive CommentsBusinessNZ manufacturing PMI dropped to 53.4, NZD/JPY extending dive

BusinessNZ manufacturing PMI dropped to 53.4, NZD/JPY extending dive

New Zealand Business NZ manufacturing PMI dropped to 53.4 in February, down from 54.4.

Sub-indices:-

  • Production up 0.4 to 53.9
  • Employment up 3.3 to 54.8
  • New orders up 5.1 to 54.8
  • Deliveries up 2.9 to 52.7
  • Finished stocks down -1 to 51.1

Comments from Bank of New Zealand economist Doug Steel:-

  • “The generally slower PMI suggests we shouldn’t expect Q1 manufacturing GDP to be much different from the flat result recorded in yesterday’s official figures for Q4,”
  • “Early livestock culling on account of adverse weather seemed to boost Q4 manufacturing activity but will have the opposite effect through early 2018 given New Year rains.”
  • “It all suggests primary processing will be a drag on manufacturing activity early in 2018,”

Comments from Business NZ manufacturing executive director Catherine Beard:-

  • Pace of expansion had levelled off in recent months
  • “noted the sluggish start to the year with a dip in new orders being a common message.”

Sharp fall in NZD/JPY this week suggests that rebound from 75.92 has completed at 78.61. The cross was held by 55 day EMA slightly below 50% retracement of 81.55 to 75.92. For the near term, it’s going to revisit key support level around 75.65/75.92. It remains to be seen if there is enough selling to push through this key support zone. But outlook is not looking good.

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