Australian PMI: Manufacturing surges into expansion in October

The Australian Industry Group Australian Performance of Manufacturing Index (Australian PMI®) increased by 9.6 points to 56.3 in October, indicating expanding conditions for the first time since July (readings above 50 points indicate expansion in activity, with higher results indicating a faster rate of expansion).

Australia’s manufacturing industries grew solidly in October with production, employment, sales and exports all moving convincingly into growth territory. Once again, the large food & beverages sector led the way with strong contributions from machinery & equipment manufacturers and with support from firmer growth in the textiles, clothing, footwear, paper & printing group. The chemicals sector stabilised in October while the pace of contraction eased in both the metal products and building materials sectors.

Respondents across all sectors noted a jump in sales and new orders as a result of pent up demand from the initial activity restrictions. The jump into expansion was driven by large improvements in New South Wales, which rose into expansion, and Victoria, which remained in contraction but improved from a deep contraction in September .

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Seasonally adjusted

Index this month

Change from last month

Long-run average

Trend

Index this month

Change from last month

Long-run average

Australian PMI®

56.3

9.6

50.5

Food & beverages

61.6

2.0

53.7

Production

55.1

5.0

51.2

Machinery & Equipment

53.9

0.4

49.7

Employment

55.3

7.6

48.8

Metals products

47.4

0.6

47.2

New Orders

58.4

13.3

51.1

Petroleum, coal, chemicals & rubber products

50.9

2.3

51.2

Supplier Deliveries

58.8

16.0

50.8

Building, wood, furniture & other

46.1

2.6

49.8

Finished Stocks

51.2

3.9

49.6

Textiles, clothing, footwear, paper & printing

53.7

2.1

46.4

Exports

52.7

6.2

49.9

Sales

56.4

14.9

49.1

Input prices

66.6

8.7

67.5

Selling prices

53.6

4.3

48.2

Average wages

57.3

5.0

58.6

Capacity utilisation (%)

78.6

1.8

73.8

Results above 50 points indicate expansion. * All indexes for sectors in the Australian PMI® are reported in trend terms (Henderson 13-month filter).

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