MNI 5 Things: Australia AI Services Dn But In Expansion

By Sophia Rodrigues

     SYDNEY (MNI)  - Following are the five key observations we made from

Australian Industry Group's Performance of Services Index for August published

Wednesday:

     --The performance of services index extended its decline in August,

following a sharp fall in July from a record high the month before, but managed

to stay in expansion for 23 months. Four of the five activity sub-indexes were

in expansion and six of the nine sub-sectors expanded in trend terms.

     --The shifting global trade landscape appears to be hurting Australian

businesses with several wholesalers noting that changing business conditions

within China are influencing their trading activity and/or profitability.

Overall wholesale trade sub-sector moderated slightly in August to 53.5 points

in trend months. Those supplying to retailers reported lower demand but the

direct sellers reported positive conditions. 

     --A key positive in the survey was the rise in retail trade, up 3.0 points

in August to 57.0 and the highest since June 2016. Retail sub-sector is getting

a boost from construction and related activity, but continues to experience lack

of customer demand and more subdued spending in drought affected areas.

     --Health, education and community services rose to 63.0 points to expand

for seven straight months, a turnaround from a weak 2017. Businesses in this

sub-sector are experiencing substantial growth but also rising input costs and

falling capacity utilization, which suggest further investment may be needed.

     --Finance and insurance sub-sector continued to expand but at a slightly

slower rate. Property and business services expanded for 23 straight months with

growth supported by infrastructure investment and new technologies.

--MNI Sydney Bureau; tel: +61 2-9716-5467; email: sophia.rodrigues@marketnews.com

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