15 Mar 2012

Manufacturing sector 'may have turned corner'

7:16 pm on 15 March 2012

The manufacturing sector experienced a jump in activity in February, recording its highest result in nearly two years.

The latest BNZ-Business New Zealand performance of manufacturing index rose to 57.7 last month, up from 50.8 in January.

A reading above 50 indicates expansion.

The indices for new orders, production, deliveries and stocks all rose in February, while employment remained largely unchanged.

BNZ economist Doug Steel says it appears the manufacturing sector has finally turned a corner, driven by a very big lift in new orders and followed up by a strong lift in production.

"I think it has something to do with the construction sector starting to slowly come off its very low base," he said.

Mr Steel said the effects of recent high commodity prices may also be starting to filter through to the manufacturing sector.