The manufacturing sector in Australia slipped into contraction territory in March, the preliminary survey from Judo Bank revealed on Friday with a manufacturing PMI score of 48.7.
That’s down from 50.5 in February, and it slips beneath the boom-or-bust line of 50 that separates expansion from contraction.
Manufacturing output shrank for a fourth straight month on the back of falling new orders. The rate at which new orders contracted was the fastest since August 2021. Anecdotal evidence suggested that higher interest rates and inflationary pressures affected client interest at the end of the first quarter.
The survey also showed that the composite PMI fell from 50.7 to 48.2 and the composite index sank from 50.6 to 48.1.
New business at Australian service providers deteriorated at the fastest pace since September 2021 as high costs and slowing market conditions weighed on demand. International demand expanded for a third straight month, however.