After many consecutive months of contraction, the PriceWaterhouseCoopers / Australian Industry Group Performance of Manufacturing Index (PMI) has rebounded into positive territory, recording a 51.7 for September, 2013 (50 denotes no change). This is a major change, and the first time the PMI has been positive since June, 2011. The increase over August came in at 5.3 points.
According to the Australian Industry Group, expansion was “strongest in the food, beverages and tobacco subsector, with mild expansion also evident in some of the smaller sub-sectors.”
The relatively lower Australian dollar and low interest rates have been regarding as being behind the expansion, along with an increase in sentiment as a result of the federal election.
Although the overall outlook was positive, some sectors underwent reversals (mining, metals, machinery), whilst the long-run of contractions in other sectors means that they are well behind where they were 12 months ago.
From a mechanical power transmission perspective, the consumable-rich industries of wood & paper, printing have performed well, whereas non-metallic mineral production has suffered due to the downturn in both residential and commercial construction. Consumables are also in demand in machinery repairs, with the large machinery and equipment (new sales) subsector languishing at 39.7.
Performance of Manufacturing Index figures are released every month, with a view to giving decision-makers market intelligence regarding forward planning.
The Australian Industry Group report précis can be accessed here… pmi_sep13
