New Zealand Factory Activity Growth Eases

New Zealand’s BusinessNZ Performance of Manufacturing Index rose to 56.5 in September 2026 from 53.2 in August, signaling a stronger expansion in manufacturing activity. Employment was the weakest sub-index at 51.8, although it remained in expansion and improved from 50 in August. Finished Stocks (59) and Deliveries (58.8) led the gains, while Production and New Orders both rose to 57. Despite the stronger reading, sentiment remained mixed, with 53% of comments being negative. Respondents continued to cite high fuel prices and uncertainty ahead of the election, although others pointed to seasonal activity, pre-Christmas orders, and improving demand. Overall, strength in New Orders, Production, and Finished Stocks suggests manufacturing momentum is building heading into the final quarter of the year.

The BusinessNZ Performance of Manufacturing Index in New Zealand declined to 53.1 in August, down from 54.3 in July, marking the 22nd consecutive month of expansion but remaining above the long-term average of 52.5. It was the lowest reading since May, as two of the five sub-indices expanded at softer rates: production (54.2 vs 57.1 in July) and deliveries (52.6 vs 55.5) both remained well above the 50.0 mark but expanded at a slower rate, while employment declined to a stable level (50.0 vs 52.2). Meanwhile, new orders (54.9 vs 53.6) and stocks of finished products (56.4 vs 53.4) both grew at a faster pace. “Respondents continue to point to cost-of-living pressures and the ongoing conflict in the Middle East as reasons for holding back, but new orders and finished stocks remaining comfortably in expansion suggest there’s still genuine underlying demand,” said BusinessNZ’s Director of Advocacy, Catherine Beard.

The Business NZ Performance of Manufacturing Index in New Zealand fell to 54.3 in July, down from an upwardly revised 60.1 in June, marking the 21st consecutive month of expansion and remaining well above the long-term average of 52.5. The deceleration in factory activity came as all of the sub-indices expanded at a softer rate. New orders (53.3 vs 64.1 in June), production (57.3 vs 59.2), deliveries (55.8 vs 57.6), stocks of finished products (53.2 vs 56.9), and employment (52.8 vs 55.6) were all well above the 50.0 mark, but expanded at a slower rate. " Respondents continue to point to the conflict in the Middle East, high fuel and raw material costs, and a general reluctance from customers to spend, with a number also citing uncertainty ahead of the election," said BusinessNZ’s Director of Advocacy, Catherine Beard.