The impact of the February earthquake in Christchurch is showing up in the country's statistics for manufacturing activity.
The BNZ-Business New Zealand Performance of Manufacturing Index declined to 50.1 compared with 53.2 in December.
A reading above 50 indicates the sector is expanding.
Senior economist at BNZ Craig Ebert says the result is no surprise given the impact of February's quake on production in Canterbury, while the weak New Zealand economy has hurt companies that supply the domestic market.
New orders fell, but hiring intentions rose which Craig Ebert says is encouraging, because it indicates firms are confident a recover is underway.