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Australia manufacturing PMI stays in expansion, but demand remains subdued
The S&P Global Australia Manufacturing PMI held at 52.0 for July, while output and new orders rose only marginally, leaving manufacturers exposed to input costs and Middle East-driven supply risks.
Australia’s manufacturing recovery showed signs of progress in July, with the S&P Global Australia Manufacturing PMI finalized at 52.0, up from 51.5 in June and its strongest level since January, Action Forex reported.
The survey indicated the sector has remained in expansion territory for four straight months, supported by renewed growth in both production and new orders as business conditions improved at the start of the second half. However, Action Forex said the gains were only marginal, pointing to underlying demand that remains subdued.
Manufacturers continued to face elevated input costs and supply pressures, which limited the strength of the rebound despite better headline activity. Action Forex also noted S&P Global Economics Director Andrew Harker’s view that the improvement is tentative, with renewed deterioration linked to the Middle East conflict potentially rekindling inflationary and supply strains quickly.
With that mix of modest improvement and persistent risk, Action Forex said the data offers reassurance that manufacturing is recovering from earlier disruption, but underscores the sector’s sensitivity to geopolitical developments that could influence inflation and the broader economic outlook.