Australia's hourly compensation cost in manufacturing was $46.29 in 2011, compared with $47.38 in Germany, $35.71 in Japan, $35.53 in the U.S. and $11.65 in Brazil, according to a survey of 33 countries by the U.S. Department of Labor. Ford Australia lost A$141 million ($136 million) during its 2012 financial year, bringing total losses over the past five years to A$600 million, Graziano said today.

Eoin Treacy's view The RBA has been attempting to pre-empt pressures on the economy by dropping interest rates to an historic low of 2.75% and leaving open the possibility that the rate will be cut further.

The strength of the currency is one of the greatest headwinds to the competitiveness of the domestic portion of Australia's economy. It is therefore notable that the spot rate has fallen to test the lower side of its two-year range over the last month. The 96¢ area represents a previous area of support and a short-term oversold condition is evident so the potential for a bounce has increased. However, a sustained move above parity is the minimum required to suggest that demand is returning to dominance beyond the short-term. Over the medium-term, any potential rally back towards the upper side of the range, below $1.10, would probably spur the RBA into additional easing.

The S&P/ASX 200 broke successfully above 5000 in February and continues to consolidate in that region as it reverts gradually towards the mean. While the short-term outlook remains skewed towards a further test of underlying trading, a sustained move back below the 200-day MA, currently near 4800, would be required to question medium-term scope for continued higher to lateral ranging.