The business sector in New Zealand fell into contraction in October, the latest survey from BusinessNZ revealed on Friday with a manufacturing PMI score of 49.3.
That's down from 52.0 in September, and it slips beneath the boom-of-bust line of 50 that separates expansion from contraction.
Individually, the two key sub-index values of Production (49.9) and New Orders (44.7) both fell into contraction, with the latter falling significantly from its near 60-mark in August. In addition, Employment (48.9) experienced its lowest level of activity since November 2021.
Manufacturers have continued their negative mindset, with the proportion of negative comments at 61.6 percent, almost unchanged from 61.5 percent for September. Staff shortages and a drop in new orders were mentioned by a significant proportion of manufacturers.
"New orders are falling while the PMI stocks index remains expansionary and firmly above its long-term norms. A low orders-to-inventory ratio typically bodes ill for production ahead," said BNZ Senior Economist Doug Steel.
