May PMI data signals easing manufacturing growth as new orders drop to a seven-month low and price pressures surge.
Australia’s manufacturing sector growth slowed in May, with the S&P Global PMI falling to 50.7 from 51.3 in April. The reading remains above the 50.0 threshold but reflects weakening momentum as new orders declined at the fastest pace since October 2025.
New orders contracted for the third straight month, driven by squeezed client budgets and subdued demand amid sharp price increases. Input costs rose at the second-fastest rate in nearly four years, fueled by higher fuel and transportation expenses, while selling price inflation hit a 45-month high.
Supplier delivery times lengthened significantly due to fuel costs and shipping delays linked to Middle East tensions. Employment saw a marginal increase, though economists cautioned the gain may not persist if demand continues to soften.