Manufacturing still shrinking

The Australian Industry Group/PwC Performance of Manufacturing Index crept up five points to 45.3 for the month of August, but the sector continues to shrink.

The PMI showed some improvements, with the subsectors of miscellaneous (62.3), food and beverage (55.4) and wood products & furniture (54) growing. Anything less than 50 represents a decline.

“Manufacturing conditions continue to be very challenging across the sector with the high dollar and weakness in demand in the domestic and export markets weighing on growth,” Innes Willox, chief executive of Australian industry group, told The Australian.

“There are some encouraging signs in the August Australian PMI with the production sub-index lifting and the forward-looking new orders sub-index rising strongly.”

The result follows China’s manufacturing sector’s contraction, Reuters reports. with the HSBC purchasing managers’ index showing a result of 47.6 for last month. This was its worst result since March 2009.

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