8 Jun 2010

Building activity up, but manufacturing down

8:25 pm on 8 June 2010

Activity in the building sector continued to rise in the March quarter, but manufacturing fell.

In the three months to the end of March, manufacturing volumes fell a seasonally adjusted 2.7% to the lowest in almost 10 years.

The fall, which was led by lower meat and dairy prices attributable to drought, follows a 2.7% rise last quarter.

Meanwhile, the amount of residential building work rose 2%, boosted by the repair of leaky homes.

The senior economist at ANZ, Khoon Goh, says the incongruous data is to be expected, but the overall picture is positive. "It suggests," he says, "that the recovery's still very much on track."

The building and manufacturing data are among the last components of gross domestic product for the first quarter, which will be released on 24 June.

The market is expecting the economy to have grown by 0.7% in the quarter.