Australia Services And Manufacturing PMI Hits 40-Month High
The S&P Global Flash Australia Services PMI Business Activity Index rose to 55.1 in August from 54.1 in July, marking the fastest growth in 40 months. The expansion was driven by stronger demand and renewed increases in new export business, particularly from the US, Europe, and Asia-Pacific markets.
To manage higher workloads, service providers added staff at the quickest pace since April 2023. Input costs remained elevated due to higher wages, materials, and shipping, but the rate of inflation eased, allowing firms to raise selling prices more moderately.
As a result, output price inflation held only slightly above the long-run average. Business confidence also improved, with firms expecting better market conditions and further growth opportunities in the year ahead.
The S&P Global Australia Manufacturing PMI rose to 52.9 in August from 51.3 in July, signaling the fastest expansion in nearly three years. Manufacturing output rose at the quickest pace in 40 months, supported by a solid increase in new orders as demand conditions improved and customer bases expanded.
Export demand also picked up, with manufacturers reporting new work from the US, Europe, and Asia-Pacific markets. Despite the stronger inflows of orders, employment in the sector declined slightly, as manufacturers shed staff for the first time since February. On the cost front, input prices continued to rise, reflecting higher material, shipping, and wage expenses, though the pace of inflation eased compared to previous months.
Goods producers also increased their input purchases and inventories for the first time in four months, reflecting improved confidence. Business sentiment strengthened notably, with manufacturers the most optimistic since April 2022.
Source: Trading Economi
