Daily Flows & Insights – Australian PMI, Manufacturing Contracts, but Services Keep Growing

Daily Flows

  • Seasonal inflows have led banks to offer attractive rates to attract funding, with 5.06% achievable for 7-month terms.
  • There was solid demand for the Great Southern Bank issuance yesterday, with the total order book reaching $670 million.
  • Demand for mutual bank paper has been healthy, with secondary trades also active yesterday.

Australian PMI, Manufacturing Contracts, but Services Keep Growing

  • Judo Bank Australia’s Manufacturing PMI fell to 46.6 in October 2024, marking the fastest sector decline since May 2020, while the Services PMI edged up to 50.6, indicating modest growth for the ninth consecutive month.
  • New orders for manufactured goods contracted sharply, resulting in the steepest production drop in 53 months.
  • Manufacturers responded to falling new work by cutting purchases and staffing levels more quickly, with inventories also declining.
  • Stronger domestic demand supported growth in the services sector, although export business saw a more significant decline.
  • Services firms increased employment at the fastest rate in five months, helping to clear backlogs of orders.
  • Both input costs and output price inflation eased in the services sector, with business confidence improving towards the end of the year.
  • The PMI results highlight the prevailing inflation dynamic, in which services inflation is consistently more stubborn than manufacturing demand & supply pressures.
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Curve Team
Jack Pedersen