Australia AIG January manufacturing performance index down 1.1 pts from Dec

Australia AIG January manufacturing performance index down 1.1 pts from Dec

	Published : Thu, 01 Feb 2007 01:49 By : Agencies Print this Story

SYDNEY (XFN-ASIA) - The Australian Industry Group and PricewaterhouseCoopers' January performance of manufacturing index (PMI) was at a seasonally adjusted 51.3 points in January, down 1.1 index points from December, the Australian Industry Group (AIG) said.

AIG said the slowing in manufacturing activity in January largely reflected the impact of higher interest rates and continuing losses of market share to low-cost competitors.

It said survey respondents also cited continuing adverse impact from supply constraints, including drought conditions in much of Australia and shortages of skilled labor and raw materials.

Despite the fall in January, it was the sixth consecutive month of expansion in activity, with readings above 50.0 signalling expansion.

AIG said new orders and export growth slowed sharply in January, leading to a more moderate expansion in production.

Growth was equally strongest in basic metal products and paper, printing & publishing, following contractions in both sectors in December.

Growth also strengthened moderately in chemicals, petroleum & coal products, and machinery & equipment, but slowed in wood, wood products & furniture and miscellaneous manufacturing.

AIG said the largest falls in activity in January were in textiles and clothing & footwear, following increases in both sectors in December.

Activity fell, albeit more moderately, in construction materials, fabricated metals and transport equipment after rises in December.

Food & beverages reported the second consecutive monthly contraction in activity in January, with the rate of decline gathering momentum.

PricewaterhouseCoopers industrial products leader Graeme Billings said an upturn in manufacturing activity seen last year appears to have lost some momentum in recent months.

bruce.hextall@xfn.com