The manufacturing sector in Australia showed a continued, albeit slightly slower, contraction, as indicated by Judo Bank's latest survey, which reported a Manufacturing PMI score of 49.7 for May.
Although this figure is a slight improvement from April's 49.6, it remains below the crucial 50-point mark that delineates expansion from contraction.
In May, both manufacturing production and new orders in Australia declined at the slowest rates observed in the past nine and ten months, respectively. Survey respondents noted that higher prices and subdued market conditions continued to impact demand, though to a lesser extent than in April. Interestingly, new export orders increased for the first time since November 2022, as respondents reported higher inflows of new work from clients in the US, Europe, and Asia.
Amid signs of easing downturn and improved export conditions, Australian manufacturers increased their workforce capacity in May, marking the first headcount rise since October of the previous year, albeit marginally. The additional staffing allowed firms to address backlogged orders more efficiently, extending the sequence of depletion to one-and-a-half years.
