Australian factory activity has enjoyed its sixth month in a row of expansion although the pace of growth eased in March as soaring energy prices added to manufacturers' costs.
The Australian Industry Group's performance of manufacturing index (PMI) fell by 1.8 points to 57.5 in March but stayed above the level of 50 points which indicates an expansion in activity.
The Ai Group says rising sales, production, employment and exports had boosted overall factory activity.
The food and beverages, machinery and equipment, metals products, and non-metallic minerals sectors grew strongly.
The machinery and equipment sector strengthened despite the ongoing exit of car manufacturers.
Ai Group chief executive Innes Willox says the momentum in the manufacturing sector is good news for workers and the economy.
"With new orders also growing strongly, the immediate outlook is for further and very welcome expansions in the manufacturing sector," Mr Willox said in a statement on Monday.
But, Mr Willox said, the Australian manufacturing sector still had a considerable way to go before reaching its full potential, with uncertainties over energy affordability, security and sustainability needing to be addressed urgently.
All seven sub-indexes in the survey - production, new orders, employment, exports, sales, input prices and selling prices - showed expansion in March.
New orders rose by two points to 62.6 points, sales lifted by 2.4 points to 57.7 points, and input prices were up by 4.3 points to 65.5 points.
Soaring energy prices and higher prices for steel and bulk commodities added to manufacturers' input costs.
The pace of expansion slowed in all the other areas.
The Australian PMI results are based on responses from around 200 manufacturers.
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