RTTNews - Australia's Performance of Manufacturing Index rose by 0.9 points to 38.4 in June, the Australian Industry Group and PricewaterhouseCoopers said Wednesday. However, the index continued to remain in contraction for the 13th consecutive month.
A reading above 50 indicates expansion, while a reading below 50 signals a contraction.
During the month, the seasonally adjusted production index dropped by 3.5 points from May to 37.9, but was 10.8 points above the low point seen in November last year. The new orders index dropped 2.8 points to 36.6, reflecting the weakness in demand for manufactured goods. However, the capacity utilization increased to 67.4% from a record low of 66.9% in May.
Employment contracted at a slower pace in June, with the index rising 3.3 points to 39. Moreover, the inventories index improved to 39.5 from a record low reading of 31.9 in May. The supplier deliveries index moved up 7.9 points to 41.3.
While the slowing in declines in manufacturing inventories, employment and deliveries is encouraging, the continued weakness in new orders and production raises doubts as to whether this trend will be sustained, Heather Ridout, Chief Executive with the AiG said in a statement.
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