We got two PMI releases from Australia today:
Australia services PMI for May 52.5 (prior 46.5)
- Australian Industry Group Performance of Services PMI.
and
Australia services PMI for May 51.5 (prior was 50.1) & composite 51.5 (prior 50.0)
- CBA/Markit services and composite PMIs for May 2019
This post is a bit of a recap on that first one, the big 6 point jumper!
In brief from the report:
- Services highlights: Increased certainty following the Federal election as well as strong mining activity and higher export demand were all noted by respondents to the PSI as having a positive effect on activity in May. Infrastructure construction along the east coast of the country continues to have a complementary follow-through to services businesses.
- Services concerns: The Federal election was also mentioned as a dampening factor on activity in the earlier part of May as customers delayed purchasing decisions until election results were known. The downturn in the property market particularly housing, was also reported as an inhibitor to sales as were the rising cost of imports due to the lower trading range of the Australian dollar against the US dollar.
Those various points raised shouldn't come as much of a surprise, all have been well canvassed. What was a surprise was the extent of the jump in May. While AiG note both positives and negatives on the election the positives seem to have clearly and hugely outweighed the negatives.
Do note the headline result for this index can swing around so expect some give back next month. Although the RBA rate cut will be a boost.
