Australian Industry Group Performance of Manufacturing Index for December falls into contraction at 49.5
- November was 51.3
The fall in December (down 1.8 points) comes after a big fall in November (down 7 points).
The last time the PMI fell into contraction was mid-2016 (see graph above … the index is now at its lowest since August 2016).
More from AiG on the result for or December:
- Six of the seven activity indexes fell
- Food & beverage manufacturers and businesses in the smaller manufacturing sectors reported higher production in the lead up to Christmas
- while respondents across the large metals, machinery & equipment and chemicals sectors reported a gradual slowing of demand, which has been evident throughout the second half of 2018.
- Five of the eight sectors expanded in December
- two were broadly stable (machinery & equipment and chemicals )
- one was in contraction … large metals sector was the only sector to contract in December
- input price index rose again in December to a three-month high (high input costs for gas and electricity)
- average wage index rose in December
- selling prices index fell into contraction (means that businesses' margins were very tight in December, as wage and input costs continue to grow)
- Three of the seven activity indexes contracted in December, three were stable and only finished stocks was expansionary.
- Most of the activity indexes have been trending down since at least the start of Q4 2018
- Six of the seven activity indicators fell indicating generally weaker conditions
Not a positive input for the AUD.
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This is the second of the Australian manufacturing PMIs for December, last we week we had the CBA / Markit version
