Business activity in Australia accelerated in June driven by rising new orders

Australia's business activity expanded at a faster pace in June, driven by rising new orders despite a sharp drop in exports, according to S&P Global data. Sentiment improved, and the labor market maintained positive momentum. At the same time, inflationary pressures eased as input costs and output price growth slowed to their lowest rate in four and a half years.

Australia's Composite PMI increased from 50.5 in May to 51.2 in June, with the services sector being the main growth driver. The manufacturing sector also returned to expansion, recovering from a brief contraction in the previous month, S&P Global reported.

New orders rose in June, particularly in the services sector, fueled by stronger consumer demand and effective marketing campaigns. Meanwhile, new business near stalled among manufacturers. Export orders, however, declined at their sharpest rate in a year amid weakening foreign demand and negative effects from US trade policies, said the company.