Australia Manufacturing Contraction Eases Sharply

2026-10-06 22:44 By Chusnul Chotimah 1 min. read

Australia’s Ai Group Industry Index for manufacturing remained in contraction in September, albeit at a softer pace, rising to -8.7 from August’s revised -14.9, marking the highest level since May 2023.

The sector remained under pressure as lower domestic demand, rising input costs, and wage pressures affected both customers and businesses, contributing to delayed investment decisions and softer orders.

Upstream industries continued to contract, with companies reporting rising costs for materials, freight, utilities, and fuel, as well as weaker demand, increased competition, and Middle East shipping disruptions.

Meanwhile, metals faced softer orders, import competition, and regulatory constraints.

Downstream, machinery manufacturers reported improvements, with machinery companies reporting rising demand, while food and beverage manufacturers also registered stronger orders.

Other industries reported rising inventories and higher utility costs.



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Australia Manufacturing Contraction Eases Sharply
Australia’s Ai Group Industry Index for manufacturing remained in contraction in September, albeit at a softer pace, rising to -8.7 from August’s revised -14.9, marking the highest level since May 2023. The sector remained under pressure as lower domestic demand, rising input costs, and wage pressures affected both customers and businesses, contributing to delayed investment decisions and softer orders. Upstream industries continued to contract, with companies reporting rising costs for materials, freight, utilities, and fuel, as well as weaker demand, increased competition, and Middle East shipping disruptions. Meanwhile, metals faced softer orders, import competition, and regulatory constraints. Downstream, machinery manufacturers reported improvements, with machinery companies reporting rising demand, while food and beverage manufacturers also registered stronger orders. Other industries reported rising inventories and higher utility costs.
2026-10-06
Australia Manufacturing Contraction Eases
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