The Australian manufacturing sector remained in growth over October, though this slowed over the month, according to the Australian Industry Group’s Performance of Manufacturing Index.
The monthly PMI survey result was 51.6, a decrease of 3.1 compared to September. The food and beverage sector, the largest within the six tracked, led the expansion with a result of 61.8 (up 1.3.) Two other sectors were above 50, and three under.
A result of 50 indicates no change, and the distance above or below 50 indicates the pace of growth of contraction respectively.
“The overall pace of expansion weakened with a slower rise in employment, and a contraction in new orders overshadowing rises in sales and production,” explained Innes Willox, the chief executive of the Ai Group.
Five of seven activity indices were above 50. Of concern is the new orders sub-index, down 8.8 points to 48.3, suggesting difficult conditions could be experienced in upcoming months.
“Weakness in construction was clearly a factor dampening conditions in the metals and building products sectors while continuing strength in mining assisted the machinery & equipment and chemicals sectors,” Willox added.
“There are indications of a bring-forward of Christmas-related sales. This, together with a slight decline in new orders will have manufacturers wary about the sector-wide performance in the coming months.”
The final PMI of 2019 will be released on December 2.
Picture: Ai Group
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