Sydney, Oct 1 (IANS): Australian manufacturing activity has risen for the third month in a row as the low Australian dollar, which has dropped 14 US cents since the beginning of the year, has aided locally produced goods to become more competitive with imports.

The Australian Industry (Ai) Group's Performance of Manufacturing Index (PMI), released on Thursday, rose 0.4 points to 52.1 in September, Xinhua reported

The increase indicates activity in the sector is increasing at a faster pace, the media reported.

An increase in local manufacturing is good news for the Australian economy as it looks for sources of growth outside the mining sector, Ai Group chief Innes Willox said.

Australia's growth has fallen with the decline of key commodity prices and a perceived global commodity oversupply while China's economy adjusts to its own structural changes.

The pending implementation of the China-Australia Free Trade Agreement (FTA) is expected to aid Australia's economy to move away from a mining and resource based relationship with its biggest trading partner through increased services and agricultural exports as well as other opportunities the deal will present as it evolves.