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. 18.06.2019
    18.06.2019
    by      In
    ABB has appointed IPD as the Australian distributor of its electrification products for the 415V switchboard manufacturer channel from July 2019. IPD will also provide ABB low voltage power distribution solutions to major electrical contractors, while all other channels will continue to be serviced... Read More
  2. 18.06.2019
    18.06.2019
    by      In
    Concrete made using industrial waste from coal-fired power stations and steel manufacturing is being used in a world-first road trial in Sydney.
    The City of Sydney is putting the product to the test on a busy inner-city street leading to Sydney Airport, replacing a 30m section of Wyndham St,... Read More
  3. 18.06.2019
    18.06.2019
    by      In
    Inspection of enclosed spaces such as tanks is laborious and expensive, requires extensive planning and following safety regulations, results in significant downtime and poses many potential hazards. Depending on the relevant regulations, most tanks are inspected every five to 10 years.
    Unmanned... Read More
  4. 14.06.2019
    14.06.2019
    by      In
    Dr Jane Oppenheim, the Scientific and Operations Director of Ego Pharmaceuticals, has been presented the Clunies Ross Entrepreneur of the Year Award by the Australian Academy of Technology and Engineering, in recognition of her leadership and innovation.
    Oppenheim leads the research and development... Read More