none

Manufacturing sector weakens in March

31-08-2010
by 
in 
Manufacturing sector weakens in March

 

After moderating in February, Australian manufacturing performance was marginally weaker in March, hit by a decline in exports and fall in new orders.

This is the 14th consecutive month the sector has contracted, according to latest industry data.

The Australian Industry Group performance of manufacturing index (Australian PMI) fell 1.2 index points in March to 44.4 points.

The index has been below the key 50 level, which separates expansion from contraction, since February 2012.

AiGroup chief executive Innes Willox said it was a disappointing result given there were some encouraging signs in the February report, where the index rose 5.4 points.

"The strong dollar, falling selling prices, further cost pressures and the weakness of commercial and residential construction continue to take their toll," he said.

Mr Willox said an interest rate cut from the Reserve Bank of Australia would benefit the sector.

"In the absence of any sign of inflationary pressures and with market interest rates still relatively high, the industry would certainly welcome a further reduction in official interest rates," Mr Willox said.

Manufacturing exports fell for the eighth straight month and selling prices declined amid rising costs.

“The decline in export earnings is particularly worrying and reflects soft demand in a number of markets, intense competition and, of course, the high dollar, Mr Willox said. 

Mr Willox said the falling trend in selling prices indicates that widespread price discounting is probably still occurring, as manufacturers seek to compete globally with an ongoing strong Australian dollar.

"The continuing gap between input prices and selling prices is contributing to a worsening profit squeeze in manufacturing," he said.

 The decline in manufacturing employment continued to ease in March with the sub-index rising by 1.2 points to 48.7.

Related news & editorials

  1. 14.12.2018
    14.12.2018
    by      In
    The convenience of opening doors or logging onto computers with the wave of a hand is now possible with new technology that enables humans to be microchipped.
    A human microchip is the size of a grain of rice and it is implanted into the hand, between the thumb and forefinger, in a quick and fairly... Read More
  2. 14.12.2018
    14.12.2018
    by      In
    An additional $500,000 Federal Government investment is set to allow Deakin’s ManuFutures advanced manufacturing business incubator to set up a new acceleration programme for its members. The new ManuFutures Export Acceleration Programme (MEAP) will support the emerging businesses to strengthen... Read More
  3. 13.12.2018
    13.12.2018
    by      In
    After a long stint as the Asia-Pacific Managing Director of 600 Machine Tools, Cliff Purser is retiring from his post in Sydney, and returning to live in New Zealand.
    The genial Englishman has led the 600 team in Australia since transferring in November 2004 from the position of New Zealand... Read More
  4. 13.12.2018
    13.12.2018
    by      In
    Adelaide has been chosen as the headquarters of the newly established Australian Space Agency.
    The Australian Space Agency was officially launched on 1st July and received $41 million over four years from 2018-19 in the federal budget to “grow the Australian space industry,” including $26 million... Read More