Key Takeaways
- Australia's S&P Global Composite PMI fell to 52.1 in September 2025, down from 55.5 in August, indicating a notable slowdown in overall private sector activity.
- The Services PMI also experienced a deceleration, dropping to 52.0 in September from 55.8 in August, reflecting weaker demand conditions.
- Manufacturing sector growth also moderated, with the S&P Global Manufacturing PMI declining to 51.4 in September from 53.0 in August.
- The slowdown was attributed to softer new order inflows, including a renewed fall in export orders, with some panelists citing the impact of US tariffs.
Australia's private sector growth experienced a modest slowdown in September, with the S&P Global Composite Purchasing Managers' Index (PMI) registering 52.1, a decrease from 55.5 in August 2025. This marked the lowest reading in three months, signaling a softer expansion in business activity. While still above the 50.0 threshold that separates expansion from contraction, the figures suggest a deceleration in the pace of economic improvement.
The services sector, a significant component of the Australian economy, also saw its expansion ease. The S&P Global Services PMI fell to 52.0 in September, down from 55.8 in the previous month. This moderation was primarily driven by a slowdown in new business expansion, which reached its weakest pace in three months.
Similarly, the manufacturing sector's growth softened. The S&P Global Manufacturing PMI declined to 51.4 in September from 53.0 in August. This indicates that while the sector continued to expand, the rate of growth was slower and only modest. New orders for manufactured goods reportedly contracted for the first time since June, with subdued market conditions cited by panelists.
The overall weakening of business activity growth was largely attributed to slower inflows of new work. Export orders notably declined, with some anecdotal evidence pointing to the negative impact of US tariffs on demand from both US clients and other major trading partners for Australian manufactured goods. Despite the softer growth, firms continued to hire at a solid pace to manage ongoing workloads and clear existing orders, and input costs continued to rise above the series average. Business confidence, however, slipped to a one-year low amid these trade uncertainties and softer global conditions.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.