The Manufacturers and Exporters Association says sales have risen, lightening a gloomy assessment of the sector's fortunes.
The association's survey of business conditions found total sales increased 13.5% in July compared with the same period a year ago.
A net 22% expect conditions to worsen, better than the 38% previously expecting gloomy times ahead.
While the high New Zealand dollar remains a persistent worry, four out of five firms say demand is the main constraint on them.