FX.co ★ Australia Services PMI Hits 13-Month High Amid Rising Optimism

The S&P Global Flash Australia Services PMI Business Activity Index experienced an uptick, climbing to 51.8 in June from 50.6 in May, indicating the most rapid expansion since May 2024. This increase represents the 17th consecutive month of growth in the services sector, driven by a robust rise in new business predominantly from domestic sources. Companies attributed this growth to heightened market interest and an expanding client roster. However, it is important to note that foreign demand decreased significantly, marking the sharpest decline in nearly three and a half years due to a reduction in international visitors. The real estate and business services sector spearheaded the growth in both activity and new sales. Employment figures continued to rise, alleviating backlogs as companies hired additional staff to handle the increased workloads. Input costs rose as a result of higher fuel, labor, and material expenses, yet the rate of cost inflation reached its lowest point of the year. Business confidence improved to its highest level since May 2022, fueled by optimism regarding stronger demand and the prospect of potential interest rate cuts.