The Australian manufacturing industry appears to be stabilising in the past two months despite the lingering effects of a rising local currency in the sector, according to the latest Australian Industry Group/PriceWaterhouseCoopers Australian Performance of Manufacturing Index (PMI).

The country's PMI for February maintained the level that is above the point of contraction, registering 51.3 in the month that pretty much sustained the previous month's readings.

The current level, however, represented a slight decline of 0.3 percent from January, yet for now it staves off any suggestions that the sector would face further difficulties in the current year, the Ai Group said on its report.

Much of the expansion was posted in Western Australia, where the country's mining boom is mostly concentrated, the report said.

What the numbers clearly suggested at this point was a manufacturing sector slowly integrating into the likelihood that the Australian dollar would sustain its present level over the long haul, Ai Group chief executive designate Innes Willox said.

And that set-up includes the Aussie dollar in parity with the U.S. dollar, Willox added.

"The tentative expansion in manufacturing activity that continued into February suggests that Australian manufacturing remains resilient in the face of the high dollar and difficult trading conditions," the Ai Group head said in a statement that came with the report.

Analysts noted that the local currency has been keeping its level against the U.S. dollar and it is likely that it would be case in the months ahead, they added.

Over the past three years, the Australian dollar has surged by up to 80 percent and has shown no sign of any letup to happen soon, The Australian said.

Yet surprisingly and even going against the tide earlier predicted by many economists, the manufacturing sector recorded spikes on order levels in February, suggesting that positive developments could be unfolding for the generally struggling sector.

"The movement of new orders into positive territory for the first time since the middle of 2011 is also encouraging," Willox said.

He, however, conceded that the industry remains cautious in the face of projected weak demands for much of the year, which mainly would be influenced by the rising Australian dollar.

Willox added that the Gillard government's carbon pricing, which takes effect July this year, will also be a cause of concern for many manufacturers if not for the whole industry.

On that note, Willox allowed that "conditions remain patchy and large sub-sectors including fabricated metals, chemicals and petroleum and construction materials are finding the current environment particularly difficult."

Consolidation and restructuring to be implemented by industry players would further lead to job losses in the sector this year, Willox said, which he added were necessary and painful adjustments to be made in order to shore up the industry's competitiveness.