Final demand producer prices climbed 2.3 percent on year in the second quarter of 2014, the Australian Bureau of Statistics said on Friday - slowing from the 2.5 percent increase in the previous three months.

On a quarterly sequential basis, final demand producer prices dipped 0.1 percent after climbing 0.9 percent in the first quarter.

Domestic producer prices were up 1.9 percent on year and 0.1 percent on quarter, while import producer prices jumped 6.4 percent on year and dipped 1.5 percent on quarter.

The quarterly decline was mainly due to falls in the prices received for other transport equipment manufacturing (-3.5 percent), computer and electronic equipment manufacturing (-3.4 percent) and other agriculture (-5.7 percent).

It was partly offset by rises in the prices received for building construction (+1.2 percent) and pharmaceutical and medicinal product manufacturing (+5.2 percent).

Intermediate demand PPI was up 2.7 percent on year and down 0.5 percent on quarter.

Domestic producer prices were up 2.3 percent on year and down 0.1 percent on quarter, while import prices spiked 6.8 percent on year and fell 2.7 percent on year.

The quarterly decline was mainly due to falls in the prices received for petroleum refining and petroleum fuel manufacturing (-9.5 percent), oil and gas extraction (-4.1 percent) and coal mining (-10.1 percent).

It was partly offset by rises in the prices received for sheep, beef cattle and grain farming; and dairy cattle farming (+6.5 percent) and printing and printing support services (+3.8 percent).

Preliminary demand PPI climbed 3.0 percent on year and shed 0.8 percent on quarter.

Domestic producer prices gained 2.5 percent on year and eased 0.4 percent on quarter, while import prices advanced 6.6 percent on year but lost 2.9 percent on quarter.

The quarterly decline was mainly due to falls in the prices received for petroleum refining and petroleum fuel manufacturing (-10.7 percent), metal ore mining (-6.8 percent) and oil and gas extraction (-4.1 percent).

It was partly offset by rises in the prices received for sheep, beef cattle and grain farming; and dairy cattle farming (+4.5 percent) and printing and printing support services (+3.6 percent).

Also on Friday, the Australia Industry Group said in its Performance of Manufacturing Index that the manufacturing sector in Australia expanded in July.

For the first time in nine months, the reading moved above the boom-or-bust score of 50 that separates expansion from contraction.

Among the individual components of the survey, new orders and employment - two of the most significant factors - both expanded in July.

"The high currency is maintaining intense pressure on exporters and import-competing businesses facing weak demand and low prices for locally made products," AiG chief executive Innes Willox said in a statement.