FX.co ★ Australia's Manufacturing Sector Steady in May

The S&P Global Australia Manufacturing PMI remained steady at 51.7 in May. While output experienced a slight increase, the pace was more subdued compared to earlier in the year. For the tenth consecutive month, new orders continued to rise, though the expansion rate notably slowed, marking it as the slowest growth phase in 2025 so far. Export demand experienced a modest uptick, propelled by new overseas manufacturing orders, even as service exports showed a continued decline. The manufacturing sector also saw an increase in employment levels, highlighting ongoing job creation, albeit at a slower rate than observed in April. Companies reported a reduction in inflationary pressures, with input cost inflation dropping to its lowest level in three months, attributed to decreasing raw material prices. There was a slight increase in output charges, indicating some transfer of costs to consumers, yet this increase was more restrained compared to previous periods. Overall, while the manufacturing sector demonstrated resilience, it also showed signs of waning momentum amidst diminished demand and reduced business confidence.