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Australia January Services PMI 49.1 (prior 47.1)

Final S&P Global / Judo Bank Services PMI for January 2024 is 49.1

(prior 47.1)

Composite 49.0

We had the manufacturing PMI last week:

Preliminary readings for the three are here.

Commentary from the report on employment and inflation:

  • “Resilience in labour demand continues to play an essential
    role in moderating the slowdown in the Australian economy.
    The employment index for January remained above the
    neutral level, close to where it has resided over the past three
    months. Despite the economy cooling, businesses continue
    to see consumer demand exceed their supply capabilities,
    hence the continued efforts to grow their workforces. Over
    the past year, the resilience in employment and labour
    demand has effectively put a floor under how much
    Australia’s economy can slow down.
  • “Price pressures facing consumers have continued to ease
    across the services sector. With demand softening in the
    economy, the seasonally adjusted Prices Charged index
    has fallen a level last seen in mid-2021 before inflation levels
    began to rise. Input price pressures have also continued to
    ease, albeit at a slower rate. The input price index fell to a
    level, which, while still inconsistent with a 2-3% inflation rate,
    was at the lowest recorded level seen since mid-2021. These
    results, alongside official data releases, will likely see the RBA
    board hold the cash rate at 4.35% in their February meeting,
    as the economy appears to be following its narrow path to a
    2-3% inflation rate.

The Reserve Bank of Australia are meeting today and tomorrow (February 5 and 6). The decision is expected to keep the cash rate on hold at its current 12 year high:

  • statement due at 2.30 pm Sydney time on Tuesday, 6 February 2024 (0330 GMT, 2230 US Eastern time)

The Reserve Bank of Australia has embarked on a new era of meetings and communications. A press conference from Reserve Bank of Australia Governor Bullock will follow.

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