Australia Services Sector Growth Hits 6-Month High

The S&P Global Flash Australia Services PMI Business Activity Index declined to 52.9 in August 2026 from July’s six-month high of a final 53.6, the preliminary data showed. The latest reading marked a third consecutive month of growth, as activity and new business continued to grow, though at slightly softer rates. Employment increased modestly, with pressure on capacity; the overall level of work outstanding increased for the second consecutive month in August, albeit only fractionally. On the price front, input costs rose amid higher fuel, freight, commodities, and raw material prices.

The S&P Global Flash Australia Services PMI Business Activity Index was revised higher to a six-month high of 53.6 in July 2026 from the initial estimate of 53.0 and after a final reading of 50.5 in the previous month. The latest reading marked a second consecutive month of growth, led by the real estate & business services and information & communication sectors, while transport & storage remained weak. Growth was supported by the first increase in new orders in five months, although export demand continued to decline. Employment rose for a second straight month at a solid pace, while backlogs of work increased for the first time in five months. On prices, input cost inflation eased to a five-month low despite higher fuel and wage costs, but firms raised selling prices at a faster pace to protect margins. Meanwhile, business confidence rebounded to its highest level since February, though companies remained cautious over persistent inflationary pressures and geopolitical uncertainty.

The S&P Global Flash Australia Services PMI Business Activity Index increased to 53.0 in July 2026 from 50.5 in June, marking the strongest growth since January, preliminary estimates showed. It was the second consecutive month of expansion in the services sector, supported by higher output. At the same time, employment also increased. On the price front, input prices rose due to higher oil prices. As a result, firms raised selling prices, driven by strong demand. Looking ahead, business confidence remained positive, following its lowest reading since November 2023 in June.