Liz Kendall, Senior Economist at ANZ, notes that New Zealand’s total manufacturing sales volumes rose 1.4% q/q in Q1, following an upwardly-revised 1.5% q/q lift in Q4.
Key Quotes
“Stocks of finished goods (which can be volatile) were up 8.3% q/q. Of the 13 manufacturing industries, nine saw an increase in volumes. The biggest contribution to the increase came from transport equipment and machinery manufacturing, up 6%.”
“Meat and dairy sales volumes were up 2.2% q/q, despite a fall in livestock slaughtering in the quarter. Export volumes fell in Q1 but sales volumes increased – with the volume of inventories up 3.7% y/y. In nominal terms, meat and dairy sales were down 4.7% q/q, with prices down for dairy (-7%) and meat and meat product (-1.6%) manufacturing.”
“Stripping out meat and dairy product manufacturing (which often throw the figures around), ‘core’ sales volumes rose 0.6% q/q with stocks of finished goods up 2.1% q/q. It is core manufacturing that is most relevant for forming our views on quarterly GDP growth.”
“Today’s core manufacturing result was perhaps a little softer than our expectations, but implications for our views on Q1 GDP growth are minimal. We will release a full preview note on our GDP expectations later this week.”
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