AUSTRALIAN MANUFACTURING ACTIVITY INDEX REMAINS LOW IN SEPTEMBER.

SYDNEY, Oct 1 Asia Pulse - Manufacturing activity in Australia fell for a fourth straight month in September as high interest rates and falling demand kept firms under pressure, a survey says.

The Australian Industry (AI) Group-PricewaterhouseCoopers Australian performance of Manufacturing Index (PMI) rose 0.2 index points to 47.2 points in September.

Despite a slight rise on August's print, the result still was below the 50 point level that separates expansion from contraction in manufacturing activity.

"Driving this month's result, the lagged effects of higher official and commercial interest rates continue to squeeze consumer and housing-related demand," the survey said.

The report noted mining related demand was positive for manufacturing activity.

Weak domestic demand, global instability, the soft housing sector, increased raw material costs, loss of staff and competition from imports were cited as detrimental to activity.

Ai Group chief executive Heather Ridout said falling demand from local consumers and across the world were hitting orders of Australian manufactures.