The Australian Industry Group Australian Performance of Manufacturing Index showed the sector continued to shrink in April, with low exports, slow activity in Victoria and high input costs featuring in the results.
The results, released this morning, showed the overall PMI at 36.7 points. Any result under 50 in the seasonally-adjusted national composite index indicates contraction.
"This is the lowest level the Australian PMI has recorded since May 2009 and the lowest export reading since the export sub index was added in 2004,” commented AIG CEO Innes Willox.
“The sharp drop in manufacturing production, employment and new orders in April, along with the continued erosion of exports, is deeply concerning,” noted Willox in a statement.
AAP states that this is the index’s 22nd consecutive month of contraction. Stephen Koukoulas, the managing director of Market Economics and a former economics adviser to the Prime Minister, commented on Twitter, “Absolutely dismal manufacturing PMI just released. RBA close to certain to cut rates next week”.
Willox said that an interest rate cut by the Reserve Bank would be welcome, as would increased investment in manufacturing in the upcoming federal budget.
Results were particularly weak in Victoria, which as a state recorded a score of 29.1.