The final June reading is 47.2, the lowest in 3 months and the fifth month in a row in contraction
- the preliminary was 47.5
- May was 49.7
Some of the comments from the report:
- manufacturing sector's key activity indicators have softened to the cyclical lows seen earlier in the year
- Manufacturers are marginally scaling back production through reduced headcounts and inventories in response to prolonged difficult trading conditions in the sector
- employment index dipped back below the neutral level. Manufacturers, on average, have been gradually reducing headcounts throughout 2024
- margin pressures in the manufacturing sector appear to be picking up. The input price index climbed significantly to 58.4 in June, which, while slightly down on the prior month, is above the average reading of 56.0 seen over the first four months of the year. The rise in input price pressures doesn't appear to have been passed onto consumers, with the output price index remaining subdued at cyclical lows in June.
Ugly results from this survey continue. After last week's ... well, ugly CPI:
- 4.1% vs 3.8% prior
the prospects of another Reserve Bank of Australia interest rate hike loom:
- The surprising uptick in inflation, coupled with fiscal stimulus measures and the RBA's current policy bias, strengthens the case
The next RBA meeting is on 5–6 August. We get official, quarterly, CPI data on July 31 ahead of that. The CPI data I just quoted above is the monthly reading for May 2024. The monthly CPI data from Australia does not show all components of the CPI, that'll have to wait for the quarterly data release.
