AUSTRALIAN MANUFACTURERS EXPECT DOWNTURN - SURVEY
A majority of Australian
manufacturers expect a deterioration in the business climate,
according to the March survey of industrial trends by Westpac
Banking Corp and the Confederation of Australian Industry.
    After expecting improvements in two previous quarterly
surveys, 56 pct of respondents reported working at less than
satisfactory levels, with insufficient orders nominated by 70
pct as the major constraint.
    Other constraints were capacity, 11 pct, and labour nine
pct, the survey said.
    Inflationary pressure increased during the quarter and
investment plans for the next year were scaled down, which the
survey said could limit activity in the medium to short term.
    Respondents reporting an increase in orders fell to 22 pct
in March from 30 pct in December, while those with orders
accepted but not yet delivered fell to 14 pct from 21 pct.
    Stocks of finished goods and raw materials fell sharply in
the March quarter and further depletion was forecast for the
June quarter, the survey said.
    Respondents said finance was harder to obtain, which
Westpac chief economist Bob Graham said was probably because of
high interest rates rather than the availability of money.
    Graham said he thought expectations would gradually improve
later this year, when the dollar might consolidate and interest
rates ease slightly.
    He believed some manufacturers were not investing because
they feared the Australian dollar would get stronger.
    "We do not believe the dollar will revalue, the (economic)
fundamentals are for it to slip away if anything," he said.
 REUTER
