Judo Bank / S&P Global PMIs from Australia for April 2023, Finalist.
Services 53.7
- The primer was 52.6
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48.6 previous
The composite is 53.0, the highest level since June last year
- The primer was 52.2
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48.5 previous
Earlier this week:
Comment from the report:
- “The Services PMI rose at the strongest pace in a year suggesting that the domestic services economy has stopped slowing and is once again gaining momentum as we head into winter. The Composite Output indicator highlights this clear cyclical shift with a clear improvement now.
- “All indicators of activity confirm the shift in Australian economic momentum adding weight to the conclusion that the general economic slowdown appears to be over. I would like to see another month of strength before a strong result, but the results look clear; the RBA may have More work if he wishes to bring inflation back to the 2% to 3% target.
- Employment indicators also jumped from already positive levels, consistent with official employment results showing strong employment growth in recent months. If the business continues to expand, there is a risk that the sluggishness of input prices will be mitigated by the tightness of the labor market, through higher wages.
- The good news on economic activity was offset by some other good news on inflation, with input prices rising at the slowest rate in 18 months and inflation holding just above a 20-month low in March. The current level of both price indices is still higher than what we saw in the economy before the pandemic and indicates that domestic inflation remains uncomfortably high. The latest results raise questions about expectations for a soft landing for the economy. Not that we are seeing an increasing risk of a hard landing but as we have seen in many economies abroad, the risk appears to be “no downside”. It’s too early to make that call but this is where the risks may lie.”
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Yesterday the Reserve Bank of Australia raised its cash rate:
2 out of 3 analysts in a Bloomberg survey of expectations were looking for the RBA’s “hold” decision, so the rally came as a surprise to them.