Still in contraction, but a big improvement over the previous month’s result, up 4.4 points
Key points highlighted by the survey:
- Seventh consecutive month of contraction in the manufacturing industry
- Many respondents continue to cite challenging business conditions
- The Federal Budget has reportedly dampened confidence levels and has delayed or lowered business commitment to new expenditure, while the renewed strength in the Australian dollar this year has seen import competition intensify again
- The production and new orders sub-indexes above 50 points (i.e. into expansion)
- Sales sub-index also expanded, following six months of contraction
- Manufacturing employment contracted at a faster pace in May
- Supplier deliveries and stocks sub-indexes both in contraction this month
- Conditions were subdued in the manufacturing export market, with the sub-index moving down below 50 points in May
- Manufacturing sub-sectors – four expanded and four contracted in May
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Over the weekend we got China manufacturing PMI improving also.
Despite the supportive news the AUD/USD is losing ground, last is back under 0.9300
