Manufacturing grew at a slower pace in May due largely to weaker new orders, production and inventories, a performance gauge produced by an industry group shows. Rising interest rates, weaker confidence on the back of global equity market losses and the ongoing debt crisis in Europe all combined to crimp factory gate output.
The Australian Industry Group-PricewaterhouseCoopers Australian Performance of Manufacturing Index fell 3.5 points in May from April to 56.3, above the 50.0 mark which separates expansion from contraction.
Six sectors reported higher production in May, down from nine in April, while two saw stable output. Hardest hit were consumer-related sectors such as food and beverages, clothing and footwear, while textiles also fell. On the positive side, good growth was experienced in transport equipment, wood products, chemicals, paper, basic metals and construction materials