The AIG Australian Performance of Manufacturing Index fell 1.8 points from a month earlier to 49.5 in December 2018, signalling the first mild contraction in manufacturing conditions in 26 months. Six of the seven activity indexes fell in December indicating generally weaker conditions: production (down 2.4 points to 49.4); employment (down 1.5 points to 47.9); supplier deliveries (down 6 points to 48.4); finished stocks (down 1.5 points to 55.9); exports (down 3.7 points to 47.1); and sales (down 2.3 points to 50.3). Meanwhile, the new orders index rose 0.3 points to 49.0. Manufacturing PMI in Australia averaged 50.61 from 2001 until 2018, reaching an all time high of 63.10 in March of 2018 and a record low of 30.86 in February of 2009.
Manufacturing PMI in Australia is expected to be 56.20 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Manufacturing PMI in Australia to stand at 53.20 in 12 months time. In the long-term, the Australia Manufacturing PMI is projected to trend around 52.00 in 2020, according to our econometric models.