Activity in Australia's manufacturing sector has risen for the first time in more than two years, helped by the lower Australian dollar and lower interest rates.
The Australian Industry Group's (Ai Group) Performance of Manufacturing Index (PMI) rose 5.3 points to 51.7 in September.
It was the first month since June 2011 that the index was above 50, indicating activity in the sector is in expansion.
Ai Group chief executive Innes Willox said the lift in manufacturing was welcome news for a sector of the economy that has been under pressure from a high exchange rate and high energy costs.
"There were encouraging indications from businesses that the easing in the dollar, low interest rates and the clear outcome of the federal election were lifting business sentiment," he said.
"The lift in the sector's performance in September was more evident in forward-pointing indicators such as supplier deliveries and new orders rather than in current-period indicators such as production, employment and exports which continued to contract or were flat at best.
"The key question is whether these tentative pointers to future growth are confirmed by further gains in manufacturing performance over the next few months," Mr Willox said.
Expansion in activity was strongest in the food, beverages and tobacco sub-sector.
Meanwhile, the metal products and machinery and equipment sub-sectors continued to show deep falls in activity.
AAP