none
none

MANUFACTURING SURGES TO 12-YEAR HIGH

05-04-2016
by 
in 

The Australian manufacturing sector surged in March to its strongest level of expansion since April 2004, driven largely by a weaker Australian dollar.

The Australian Industry Group Australian Performance of Manufacturing Index Australian PMI rose by 4.6 points to 58.1 last month. Readings above 50 indicate expansion in activity.

This is the ninth consecutive month of manufacturing growth.

Ai Group Chief Executive, Innes Willox, said last month’s growth was fueled by increases in manufacturing production, sales, employment, exports and new orders.

Five of the eight manufacturing sub-sectors expanded, led by the largest, beverages and tobacco.

Significantly, the machinery and equipment subsector, which has been hit by the mining and resources slowdown, moved out of contraction in March for the first time in more than four years.  

“The strong manufacturing performance and its expansionary run since the middle of 2015 are in large part due to the boost provided by the lower Australian dollar,” Mr Willox said.

“Even though the dollar has appreciated quite strongly since mid-January, the local currency is still close to 30 per cent lower against the US dollar and almost 20 per cent lower against the Trade Weighted Index compared with three years ago.”

Mr Willox said the positive impacts of the depreciation have taken time to accumulate as businesses have become more confident that it will be sustained.

“With momentum positive and new orders growing strongly, the positive trend appears to have some way to run,” Mr Willox said. 

However, Mr Willox warned that the rise in the value of the Australian dollar over the past two and a half months (by 10 per cent against the US dollar and by over 7 per cent against the TWI) may limit further growth.

“This will test some manufacturers and, if maintained, can be expected to slow the pace of recovery over the months ahead,” Mr Willox said.

Related news & editorials

  1. ETA’s warehouse has extensive Bonfiglioli stock
    11.01.2018
    11.01.2018
    by      In
    Bonfiglioli’s partnership with its largest Australian distributor, Engineering Transmission Agencies (ETA), brings quality, reliability and performance to Queensland and Northern NSW customers in industries such as mining, manufacturing, bulk materials handling, food and beverage, water and waste.... Read More
  2. Australian flag
    11.01.2018
    11.01.2018
    by      In
    It’s official: Australia is an Innovation Champion. That is the view of the US Consumer Technology Association, which launched its inaugural International Innovation Scorecard at the Consumer Electronics Show in Las Vegas.
    The scorecard is a development from the association’s annual ranking of US... Read More
  3. 10.01.2018
    10.01.2018
    by      In
    Australian company CST Wastewater Solutions has put together an environmentally friendly and cost-efficient wastewater treatment system for smaller, remote and ecologically sensitive community, municipal, agribusiness and industrial applications throughout the Asia-Pacific region.
    The two-stage... Read More
  4. 10.01.2018
    10.01.2018
    by      In
    US-based utility-scale solar power specialist SolarReserve has received development approval for its Aurora Solar Energy Project in South Australia.
    The project is located on farmland 30km north of Port Augusta and is centred on a 150MW solar thermal power station with 1100MWh of molten salt energy... Read More