11 Sep 2012

Little sign of a manufacturing rebound

7:14 am on 11 September 2012

Manufacturing eked out a rise in the second quarter's economic statistics, but a grim outlook for Australia is expected to weigh on the sector in coming months.

Statistics New Zealand says volumes rose a seasonally adjusted 0.3% compared with the March quarter, when they rose 1.2%.

When meat and dairy sectors are stripped out of the figures, core volumes rose 0.5%.

ANZ Bank senior economist Sharon Zollner says that the solid increases seen in meat and dairy were expected but there were also rises in other sectors including machinery, textiles and non-metal minerals.

But she says that industry faces a tough time ahead with the high dollar and fickle global situation.

"Those headwinds aren't easing ... around the world, manufacturing is not having a great time," she said.

"There's very little to suggest a rebound is imminent."

Ms Zollner says a pickup in the construction sector could help manufacturing.

"The fate of New Zealand's manufacturing voumes depends more on the weather than on anything else: the prices, of course, depend on how the world goes," Ms Zollner said.