Services PMI falls sharply

From the AIG:

 The Australian Industry Group Australian Performance of Services Index (Australian PSI®) moderated in February, with the index falling 5.5 points to 49.0 (results above 50 points indicate expansion, with higher numbers indicating a stronger rate of expansion). This indicates stable conditions across the sector, following three months of growth.

 Only one of the five activity sub-indexes in the Australian PSI® was above 50 points and indicating expansion in February (seasonally adjusted data). Supplier deliveries continued to grow (53.7 points), but at a slower pace than in January. The four other activity indicators indicated stable (around 50 points) or contracting (under 50 points) conditions in February.

 Six of the nine services sub-sectors in the Australian PSI® expanded in February (trend data). Wholesale trade continued to grow strongly (61.1 points), while finance and insurance also expanded more strongly (up to 60.4 points). Personal and recreational services (56.5 points), retail trade (54.3 points), property and business services (53.2 points) and health and community services (54.7 points) also expanded. The hospitality, transport and communications sub-sectors contracted (under 50 points).

 A number of respondents to the Australian PSI® noted that suppliers to the house construction sector were experiencing increased activity, and that increased marketing efforts were having a positive effect on their sales. Problem areas in February included lower demand from mining customers, lower spending by households and adverse local weather events such as the eastern heatwave, a lack of rain and local storms.

Employment meh. Full report.