none

Manufacturing activity remains slow

31-08-2010
by 
in 
Manufacturing activity remains slow

Despite a falling Australian dollar and record low interest rates, the manufacturing sector continues to struggle.

The Australian Industry Group's (Ai Group) Performance of Manufacturing Index (PMI) was 42.0 in July, down 7.6 points from June. Readings below 50 indicate a contraction in activity.

It was the 25th consecutive monthly contraction in manufacturing activity.

Five sub-sectors improved in July, while three worsened. Food and beverages was the only sub sector to expand.

Despite the falling Australian dollar, the exports sub-index is well below 30 points again and close to its recent record lows.  

The Australian dollar has fallen around 14 US cents since early May and currently is trading below 90 US cents.

Ai Group chief executive Innes Willox said the manufacturing sector had failed to build momentum after a promising result the previous month.

“Manufacturers are telling us that, while the fall in the Australian dollar and the May interest rate cut have been extremely welcome, they have not yet been enough to turn around a very challenging business environment, he said. “In fact, the drop in the currency has fuelled higher prices for imported inputs without any real corresponding improvement in stronger exports.”

Mr Willox said confidence among manufacturers and their customers remained relatively depressed.

“Concerns are evident about the timing of this year's federal election with related policy uncertainty in key areas, he said. “This is causing many businesses to further postpone their investment decisions.”

Related news & editorials

  1. 16.08.2018
    16.08.2018
    by      In
    Following extensive growth of the business, Beacon Solar (a division of Beacon Lighting Group) has changed its business (trading) name to Beacon Energy Solutions.
    Beacon Solar has been in the energy efficiency/solar market for more than 10 years, with the business initially offering residential... Read More
  2. 15.08.2018
    15.08.2018
    by      In
    BHP’s new $4.8 billion South Flank iron ore mine in the Pilbara is expected to create about 2500 jobs during construction and 600 ongoing roles. But local fabricators are quire rightly up in arms about the company’s decision to award the contract for 20,000 tonnes of structural steel work to... Read More
  3. 14.08.2018
    14.08.2018
    by      In
    The former Trade Commissioner of Denmark to Australia and New Zealand, Michael T Hansen has been named General Manager of Nilfisk in Australia.
    Originally from Denmark, Hansen has more than 25 years of experience in business development and sales.
    Over the last 9 years as Trade Commissioner, Hansen... Read More
  4. 14.08.2018
    14.08.2018
    by      In
    World-renowned physicist Dr Cathy Foley has been named CSIRO Chief Scientist with a brief to help champion science, its impact and contribution to the world. Dr Foley is best known for her work developing superconducting devices and systems that have assisted in unearthing over $6 billion in... Read More