Australia’s manufacturing sector remained in contraction in May, but the pace of decline slowed, according to the latest AIG Manufacturing Index data. The index climbed to -22.4 in May 2026 from a revised -27.9 in April 2026, signaling that while conditions are still weak, the sector’s downturn is becoming less severe.
The improvement suggests some stabilization in activity after a particularly difficult April, when the indicator hit one of its lowest recent readings. Although the index remains firmly in negative territory, the smaller negative value indicates that the contraction in output, orders, or related manufacturing metrics has moderated over the month.
The updated figures, released on 2 June 2026, will be closely watched by investors and policymakers for signs of whether this easing trend can continue and potentially pave the way toward a broader recovery in Australia’s industrial base over the coming months.
