Global manufacturing PMI up, Australia down slightly

Tuesday saw the release of manufacturing performance reports that told two different stories: that of the global manufacturing industries, and those in Australia.

The J.P. Morgan Global Manufacturing PMI report for the global manufacturing industry posted 50.3 in June, up from 49.5 in May, a reading slightly above the neutral mark of 50.0 for the first time in three months.

J.P. Morgan said that three out of the five PMI constituents were at levels consistent with an improvement in operating conditions (output, new orders and suppliers’ delivery times). Although stocks of purchases and employment both fell, rates of contraction were only marginal. The Global Manufacturing Output Index rose by 2.3 points to a four-month high of 51.3 in June, up from 49.0 in May. This was the best month-on-month gain in its level since June 2022.

In contrast, Australia’s manufacturing sector growth further softened in June, according to S&P Global Australia Manufacturing PMI data. The report said this was amid a fractional fall in production, while new orders returned to contraction, and business optimism also eased amid concerns over the growth outlook.

“The headline seasonally adjusted … PMI … posted above the 50.0, with no change for a sixth straight month in June to signal that manufacturing sector conditions continued to improve. At 50.6, down from 51.0 in May, the latest reading was the lowest since February, however,” the report stated.

According to S&P Global, panellists often mentioned that US trade policy was negatively affecting global demand for manufactured goods, including for Australian products.

Image credit: iStock.com/Galeanu Mihai