Australia's private sector activity edged closer to stabilization in June, but persistent declines in new orders and the weakest business confidence since the pandemic reflected lingering demand-side weakness despite easing inflationary pressures, according to a survey by S&P Global released Tuesday.
The Flash Australia PMI Composite Output Index rose to 49.8 in June from 48.7 in May, remaining just below 50 no-change mark and signaling broadly stable business activity, the report said.
A reading below the 50-point threshold indicates contraction.
The Flash Services PMI Business Activity Index rose to 49.9 in June from 48.7 in May. The Flash Manufacturing Output Index edged down to 48.9 from 49, while the Flash Manufacturing PMI increased to 51.2 from 50.7.
Output showed signs of stabilizing in June, but new orders continued to weaken, with firms reporting a fourth consecutive monthly decline amid ongoing market uncertainty and falling export demand, per the report.
Business confidence fell sharply in June amid uncertainty over economic conditions and the outlook, hitting its lowest level since the onset of the COVID-19 pandemic in March 2020.
Employment rose again in June as firms expanded capacity and hired across both manufacturing and services, reversing May's first job decline in nearly a year and a half.
Companies cut into existing backlogs at the fastest rate in over two-and-a-half years as rising staffing levels and weakening new orders accelerated the decline in outstanding work.
Input costs continued to rise sharply in June, though inflation eased for a second straight month to its lowest level since March amid widespread reports of higher fuel and transport expenses.
Output price inflation eased in June as firms slowed the pace of price increases in response to moderating input cost pressures, marking the weakest rise in charges since February.