Australian PMI: Manufacturing goes from strength to strength
The Australian Industry Group Australian Performance of Manufacturing Index (Australian PMI) increased by a further 1.8 points to 61.7 in April, indicating a seventh consecutive month of recovery from the severe disruptions of Covid-19 in Q2 of 2020 and the index’s highest monthly result since March 2018. It is the third highest rate of growth recorded since the Australian PMI moved to a monthly format in May 2001 (readings above 50 points indicate expansion in activity, with higher results indicating a faster rate of expansion).
All six manufacturing sectors in the Australian PMI expanded in April 2021, as did all seven activity indicators. The capacity utilisation index hit a record high, suggesting employment and/or investment may need to step up in order to facilitate further growth from here.
Ai Group chief executive Innes Willox said, “Australia’s manufacturing industry showed no signs of slowing in the month following the end of the JobKeeper wage subsidy. Instead the industry continued to grow and in fact lifted the pace of expansion in April. All six manufacturing sectors expanded at a healthy rate led by the food & beverage sector with very strong support from the machinery & equipment and building products sectors. There was a large lift in manufacturing production, sales and exports and employment continued to grow solidly – although not at the very rapid pace seen in March. To date the sector as a whole has not been adversely affected by the stronger Australian dollar although a number of businesses are keeping a close eye on where the currency goes from here. That said, the further expansion of new orders in April is an encouraging pointer to continuing positive conditions over the next couple of months,” Willox said.