FX.co ★ New Zealand Factory Activity Falls Back Into Contraction

The BusinessNZ Performance of Manufacturing Index (PMI) for New Zealand decreased to 47.5 in May from 53.3 in April, indicating a shift back to contraction after four successive months of growth. This downturn points to a notable slowdown in the sector, which had previously shown signs of recovery earlier this year. Among the five primary sub-indices, four experienced declines, with New Orders dropping to 45.3 and Employment plunging by 8.9 points to 45.7, marking its lowest level since July 2024. The proportion of respondents expressing negative sentiment increased to 64.5%, up from 58% in April. Manufacturers identified falling demand, weak orders, and low business confidence as significant hurdles. Additional challenges mentioned were escalating costs, economic uncertainty, and stagnation in forward orders and investment.