PSI weakens

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The AiG PSI for July is out and shows creeping weakness:

The latest seasonally adjusted Australian Industry Group/Commonwealth Bank Australian Performance of Services Index (Australian PSI®) fell by 2.3 points in July to 46.5.

■ The decline in the Australian PSI® reflected a fall back in sales and new order levels, after they expanded in June, and a further decline
in employment.
■ Stock levels were broadly unchanged in July after contracting for much of the year.
■ Pressure on profit margins persisted in July with selling prices continuing to contract amid further increases in input prices and average wages.
■ Economic uncertainty, weak activity in manufacturing and construction, the carbon tax and the high dollar were noted as factors behind the fall in sales and new order levels in July.

Looks like retail is holding thigns up:

And here’s the internals:

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Somehow this was interpreted at the AFR as a fall in construction, which isn’t in the index:

Perhaps confused with the PCI? Or this line from the press release:

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Only three sub-sectors – health & community services, finance & insurance and accommodation, cafes & restaurants – expanded in July. Respondents cited economic uncertainty, weak activity in manufacturing and construction, the carbon tax and the high dollar as factors negatively influencing sales and activity levels in the month.

Gotta be careful what you write, flackers.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.