Manufacturing strongest in three years

CANBERRA, AAP – Australian manufacturers are putting in their best performance in three years as their recovery from the recession continues.

The Australian Industry Group’s performance of manufacturing index rose by a further 1.1 points to 59.9 on Thursday, its highest level since March 2018.

It was the index’s sixth consecutive rise and showed the industry was comfortably in expansion territory.

Ai Group chief executive Innes Willox said manufacturing grew across the full range of sectors.

“Employment growth surged with manufacturers’ confidence boosted by buoyant levels of new orders,” Mr Willox said.

“The challenge over the next couple of months will be to maintain momentum as fiscal support is wound back further and while COVID-19 remains a threat.”

This week has seen the end of the JobKeeper wage subsidy and the demise of the coronavirus supplement.

House prices are expected to have seen another strong lift in March, matched by a further rise in demand for mortgages, with interest rates at record lows.

The CoreLogic home value index will be released on Thursday, having surged two per cent in the previous month, which was the biggest monthly gain in over 17 years.

It took prices in February comfortably above their pre-COVID levels and 0.7 per cent above the previous all-time high in September 2017.

Economists at Westpac expect the index will go one better in March, rising 2.5 per cent, which would be a 32-year high in terms of monthly gains.

The Australian Bureau of Statistics will also release home lending figures for February.

Westpac expects a further two per cent increase, building on the 10.5 per cent jump in January to a record high.

Financial regulators are keeping a watchful eye on developments in the housing market, but say there is no cause for alarm at this stage.

The housing sector aside, the ABS is cramming in a flurry of other indicators ahead of the Easter break, releasing figures for retail spending, international trade and job vacancies.

For retail trade, economists are largely sticking to the 1.1 per cent decline for February that was recorded in the preliminary result released last month.

Economists expect a trade surplus of $9.5 billion in February, and close to the record $10.1 billion surplus recorded in January.

The ABS will release quarterly job vacancy figures for the three months to February.

In the three months to November, vacancies leapt 23 per cent, reflecting an easing of COVID restrictions.



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