Judo Bank S&P Global PMIs:
- Services 50.4
- Composite 49.9
The flash readings for this are here:
Last week we got the final manufacturing PMI, which slightly improved from June but was still firmly in contraction:
Australia Services PMI: Growth slows, new orders fall in July
- Judo Bank Australia Services PMI dips to 50.4 in July from 51.2 in June
- New business declines for the first time since January
- Employment growth eases to 19-month low
- Input costs and selling prices rise at fastest pace in nearly a year
The Australian services sector continued to expand in July, but at a slower pace as new orders fell for the first time since January. The Judo Bank Services PMI dropped to 50.4 from 51.2 in June, marking the slowest growth in the current 6-month expansion streak.
Key details:
- New business declined modestly, with transport & storage seeing the sharpest drop
- Export orders fell at the fastest rate in 7 months
- Employment growth eased to a 19-month low
- Input costs and selling prices rose at the quickest pace in 11 months
The data suggests some cooling in the services sector as stimulus effects fade. However, economists expect government tax cuts and cost-of-living support to potentially boost activity in August and September.
The overall Composite PMI fell to 49.9 (from June’s 50.7), indicating a decline in private sector output. Manufacturing weakness was the main driver, though services growth also slowed.
With inflationary pressures persisting, the RBA will likely maintain a hawkish stance in the near-term despite signs of softening demand. Coming up from the RBA this week:
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Note, it’s a holiday in Sydney today. AUD liquidity will be thinned out somewhat.
