The BNZ-BusinessNZ Performance of Manufacturing Index dropped to 46.1. Photo: 123RF
The manufacturing sector has contracted for the sixth month in a row, falling to the lowest reading since the 2009 Global Financial Crisis outside of the Covid-19-period.
The latest BNZ-BusinessNZ Performance of Manufacturing Index (PMI) dropped to 46.1, which is the lowest monthly reading since June 2009 and well below its long-term average of 52.9 points.
A reading above 50.0 indicates manufacturing is generally expanding and less than 50.0 indicates a decline.
BNZ senior economist Craig Ebert said the PMI headline result was far worse than seen during past recessions.
"The August result also loses points for its latest composition as new orders and production were the biggest drags being 8.0 and 9.5 points below par respectively," he said.
BusinessNZ director Catherine Beard said that the August result told the tale of another tough month for the sector.
Only finished stocks at 52.1 remained in positive territory. All the other sub indexes contracted.
However, the proportion of negative comments dropped to about 67 percent, compared with 72 percent in July, with manufacturers concerned about domestic and international market uncertainty, rising costs and unhelpful weather.