The S&P Global Flash Australia Services PMI Business Activity Index edged up to 49.9 in June 2026 from 48.7 in May. Although still marginally in contraction territory, the latest reading shows the services sector moving closer to stabilization. This improvement also pushed the Composite Output Index up to 49.8 from 48.7, pointing to broadly steady overall private sector activity.
Despite these gains, underlying demand remained weak. New orders fell for a fourth consecutive month amid ongoing market uncertainty, and export demand also softened. Business confidence slipped to its lowest level since the pandemic, highlighting growing concerns about the outlook.
On the labor front, employment returned to growth, even as firms continued to work through existing business, reducing backlogs at the fastest rate in more than two years. Meanwhile, both input cost and output price inflation moderated further, though companies continued to face persistent upward pressure from fuel and transportation costs.
